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Legislature at an impasse on solution for school finance

Lawmakers debate necessity of another special session

By David Kassabian

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Published: Thursday, July 8, 2004

Updated: Friday, January 9, 2009

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Elizabeth Hernandez

As most representatives and senators spend their summers at home, the hallways of the Capitol echo with emptiness, besides the occasional eager visitor. Working groups consisting of a handful of legislators will meet by the end of this week to decide what is the best approach to new school funding laws.

Lawmakers are continuing to search for new sources of funding for the state's public education system amid growing concern that it is too late for any agreement to be reached this summer, according to some legislators involved in the proceedings.

More than a month after the first special legislative session on public school finance ended in a stalemate, members of the House and Senate still have not been able to agree on a method to fund the state's primary and secondary schools. Joint working groups in the Legislature have been debating ways to rely less on property taxes for school funding since the end of the first special session. However, no formal meetings have been held on the issue during the last three weeks.

"I think the working group is still in the discussion phase, such as doing legwork and getting feedback from taxpayers as to which [solutions] we should contemplate and which to throw away," said Matt Welch, spokesman for Rep. Talmadge Helfin, R-Houston. "They haven't talked about anything that hasn't been on the table for months or even a year."

The lack of consensus among the Finance Reform Working Group is partly due to uncertainty regarding several key issues, said J.J. Garza, chief of staff for Rep. Rene Oliveira, D-Brownsville.

The finance working group still needs to find out how much money it wants to put into education, how much it wants to bring down current local property taxes and then figure out what it will replace that revenue with, Garza said.

Lawmakers are having to tackle the issue now because the current school finance system is deficient, said Caroline Hoxby, a Harvard University economics professor appointed to the Joint Committee on Public School Finance.

"Texas has a system of school finance that is remarkably inefficient compared with what it would be," Hoxby said. "It's possible to have property-tax relief while raising school revenue."

The committees have discussed sources of school revenue, including sales-tax increases, payroll taxes, corporate franchise taxes, state-level property taxes and video lottery terminals, but some members say they still have not decided which funding sources to focus on.

"Today, I do not see consensus on the revenue source," said Sen. Eliot Shapleigh, D-El Paso. "I believe the governor may elect to wait so that he can use the budget as a club to bargain with during the regular session."

Deciding whether to solve the school finance issue now, or during the Legislature's 2005 regular session, is another source of dispute among some lawmakers.

"I would hope the school finance issue is resolved in a special session during the summer," said Rep. Jerry Madden, R-Plano. "That is the best time to do it, because the concentration is there - during a regular session everyone has their own agenda."

Opponents of calling a special session say any changes made to the school finance system will not be incorporated into school's budgets until the 2005-06 school year.

"If we had these special sessions in 2003, there could have been some urgency, but this close to the regular session, it is too late," said Sen. Judith Zaffirini, D-Laredo. "I believe we should address school finance during the next regular session while continuing discussions among the workgroups."

The Finance Reform Working Group is scheduled to meet this Friday, and the Education Excellence Working Group will meet July 13. Both meetings are closed to the public.

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