School finance lawsuit moves forward

The future of public education in Texas may be decided in an Austin courtroom rather than the state capitol.

The Plano ISD Board of Trustees received an update Tuesday on its lawsuit against the Texas Education Agency. Plano ISD is one of 585 Texas school districts that are suing the state claiming the model used to provide funding to districts is inadequate, and that the system is a de facto statewide property tax, which would be unconstitutional.

The lawsuit will be heard in late October, with a decision expected about six months later, said Karla Oliver, the district's assistant superintendent for government and community relations. She added that regardless of the decision, an appeal is almost guaranteed.

"We want the schools to be adequately funded," Oliver said. "Remember that [last year] we lost $4 billion from public education overall and got a new accountability system, and that the state is receiving about 80,000 new students a year. It is really not about more money, it is about money being well spent."

Public school districts in Texas have filed five lawsuits against the state, all of which will be tried together in district court in Austin. A sixth lawsuit, filed by charter school operators, is also likely to be tried alongside the other cases. However, a representative from Schulman, Lopez & Hoffer, the firm representing the charter schools, said no official paperwork had been received confirming the cases will be joined.

The school districts involved in litigation range from property wealthy to property poor, and include small rural districts and large urban districts. While the districts may have different goals, including deciding whether funding should continue to be equalized throughout the state via the "Robin Hood" recapture program, Plano ISD Superintendent Richard Matkin said he hopes the districts can remain united throughout the duration of the lawsuit.

"Sometimes when you get into litigation you can get splintered," Matkin told the board. "There is an equity issue, which is what recapture is formed around. ... We are on the same page with [the district's that receive Robin Hood funding]. They are in agreement that it is a legislative issue. When we get to the legislature and not the courts, [they will make the argument that] things need to always be equal."

Plano ISD is one of 86 members of the Calhoun County ISD lawsuit, also known as the Texas School Coalition suit. The members of the coalition are typically Chapter 41, or property wealthy, districts, all of which are required to send a portion of their local tax revenue to the state to be redistributed.

During the two most recent budget cycles, Plano ISD has sent more than $62 million to Austin for redistribution, a process Matkin said he would like to see changed.

"Not to whine, but it is just not fair," Matkin said, while noting that Texas was recently ranked 49th in educational expenditures per student. "... Communities can go out for a tax rate election, but we know what a tough sell that can be. When you then have to return any of those dollars to the state, that is what I am saying is just not fair."

Currently, the maintenance and operations portion of the Plano ISD tax rate is $1.04 per $100 of valuation, the maximum allowed by law without voter approval. With voter approval, the district could raise the rate to $1.17.

The court's decision will likely be handed down during the legislative session, with an appeal not be heard for several months after that. Therefore, no financial relief is expected for districts until the 2014-2015 budget cycle at the earliest. Depending on the court's ruling, a special legislative session could be called in early 2014 to create a new funding model.

Plano ISD's budget strategy has taken all of this into consideration, Matkin said, adding that the district's fund balance should allow it to make it through the tough times that lie ahead.

"Before we have to ask our voters for any more tax revenue money, we want to see a change in the system, or more money into the system," Matkin said. "... It is going to be hard for school districts to get to 2014-2015, but we are committed to trying to do that."

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