Equalizing Funding of Texas School Facilities – A Long-Standing, Long-Neglected Need

Albert Cortez, Ph.D.

In his 1997 book, Texas School Finance Reform: An IDRA Perspective, Dr. José A. Cárdenas, IDRA’s founder and director emeritus, summarized state legislation related to school funding between 1973 and 1984. 1973 was the year in which Texans for Educational Excellence began and later became IDRA. 1984 was the year in which the state of Texas adopted HB 72, then the most sweeping change in Texas school finance ever adopted.

In his summary, Dr. Cárdenas describes some of the salient characteristics of the 22-year legislative era that collectively had created increased pressure for school finance reform. Describing developments surrounding the legislative session in 1973, he offers a litany of reasons it seemed unlikely that Texas would continue "to hold school districts responsible for providing school facilities entirely at local expense" (1994).

Explanations for why the state would be expected to move forward on this issue included the following: there was growing recognition and acceptance that education was a state responsibility; there was growing consensus among legal scholars that a system where the state was a non-participant in school facilities funding would likely not stand up to a new legal challenge; the local property tax was too narrow a tax base to continue supporting the cost of school construction – especially in low property wealth school districts; the cost of constructing school facilities was increasing at a faster rate than the taxing ability of many school systems; the bonded debt of Texas school districts was growing at a rapid rate; and many students were attending Texas public schools that had inadequate facilities.

Like many of his contemporaries, Dr. Cárdenas and other school finance experts recognized that continuing reliance on local property taxes that were applied to greatly unequal property tax bases among Texas districts (wealth ranging from over $1 million per student in the state’s wealthiest school districts to less than $6,000 per student in the poorest districts) was one of the weakest features of the state public school funding method.

There were hopes that the 1973 legislature would provide a solution since it was shaken by the narrow federal ruling regarding the inequities in the Texas school system (Rodríguez vs. San Antonio Independent School District). But the funding provided was far less than was needed to begin to address facilities needs.

And the issue was subsequently ignored for the next 20 years.

Eventually, a district court ruling challenged the inequities of the Texas funding system. The court agreed that the inequities created by the state’s failure to provide equalized return for facilities-related tax effort deemed the system unconstitutional. Later Texas Supreme Court decrees, however, set aside the lower court ruling, thereby allowing for the existing inequities to continue.

In a 1994 Texas Supreme Court ruling, the court did note: "We acknowledge, and the state concedes that, if the cost of providing for a general diffusion of knowledge rises to the point that a district cannot meet its operations and facilities needs [emphasis added]?within the equalized program, the state will at that time have abdicated its constitutional duty to provide for an efficient system… From the evidence, it appears that this point is near" (1995).

The constitutionality of the Texas school finance system was again challenged in a 2003 suit filed by a combination of wealthy and poor school districts that alleged the state’s failure to provide sufficient funding – including inadequate and inequitable funding for facilities – in tandem with limits on local school property taxes prevented districts from meeting their obligation of providing for a general diffusion of knowledge as required by state law (West Orange Cove vs. Neeley, 2005). The Texas Supreme Court ruled that the existing system, though meeting requirements regarding providing an efficient education for all Texas students, failed to provide local districts sufficient "meaningful discretion" to supplement the state-funded program. The Supreme Court in essence ducked the questions regarding the constitutionality of the inequities in the school facilities portion of the state funding system by ruling that the plaintiff districts had not provided sufficient evidence to enable it to rule on that aspect of the system.

With the pressure to provide some level of equalized funding diminished by the court’s ruling, the 2005 and subsequent special Texas legislative sessions paid little attention to facility funding needs.

Recognizing the need for updated information, Texas senate leaders called for an interim study of Texas facilities at the end of the 2005 session.

Weak Facilities Detailed

In late 2006, the state released results of the first comprehensive assessment of Texas school facilities compiled in the last decade. Following is a summary of findings from Current and Future Facilities Needs of Texas Public School Districts (Texas Comptroller of Public Accounts, 2006).

  • Texas schools used a total of 10,557 portable facilities comprising more than 12 million square feet.
  • Among 3,500 instructional facilities in the survey, only 62 percent were rated as good or excellent; 25 percent were rated as being in fair condition, and 6 percent (which included 205 instructional facilities) were rated as poor or in need of replacement.
  • Of an estimated $4 billion in facilities needs identified by Texas school districts, only 10 percent was incorporated in fiscal year 2006 budgets; 91 percent of existing maintenance needs were deferred for some future action (most likely due to lack of sufficient funding to address the needs identified).
  • The greatest needs for facilities funding were reported in urban and central city districts, though small town and rural communities also reflected significant needs.
  • Projected facilities needs were estimated by asking districts to project enrollment growth: 56 districts projected a growth of 25 percent or greater over the next five years; another 111 projected similar growth over the next 10 years; a total of 296 school districts projected growth rates of 25 percent or greater over the next 15 to 20 years.
  • The great majority of facilities needing replacement over the next 20 years are elementary school campuses.
  • Though the summary focused on instructional facility needs, the study also identified extensive repair and replacement needs in other categories that included space used primarily for administrative, support services, warehouse, extracurricular and residential purposes.
  • The survey reported that 659 elementary, 125 intermediate, and 115 high schools had enrollments that exceeded the schools’ capacity.

With one-third of Texas’ school districts responding to this survey, the results give a good panorama of the facilities needs our schools are facing. For the few who may have continued to question the need for substantial state involvement in helping local school districts, these new data provide a somber insight into the extent of the need. While addressing all the needs that have been identified would no doubt require the billions of dollars identified in this long-needed study, it is unlikely that the legislature will do more than address a portion of the existing facilities funding needs.

IDRA Recommendations

As state leaders grapple with prioritizing investments in this long-neglected area, IDRA recommends that the following guide those policy deliberations.

  • Any funding provided to support facilities construction, maintenance or repair should be incorporated into state equalized funding formulae.
  • Priority for funding should begin with addressing instructional facility needs.
  • In the likely event of limited state funding, factors considered in any prioritization should include district property wealth, age of existing district facilities, safety considerations and district growth over the previous three to five years.
  • To help fund state support for local district facilities, to provide greater equity in facilities resources and to contain some state costs, some level of recapture should be instituted for facility-related tax efforts.

Few would question the importance of the quality of the buildings in which education is provided. While the state had made some improvements in providing for equalized funding of daily operations (weakened by the recent re-introduction of unequalized enrichment), its efforts related to facilities funding fall far short of what is needed.

The new information from the 2006 report on existing school facilities can help inform the legislative process, but by itself it will not create the will needed to fully address this long-neglected need that impacts all school districts, in all portions of the state, with all manner of students.

The latest Texas Supreme Court ruling noted that there was a lack of evidence of the extent of need for facilities in Texas public schools. This study addresses that concern.

Failure by the current legislature to significantly improve its effort to equalize facilities funding will no doubt lead to a new legal challenge that focuses primarily on facilities. We can only hope that this legislature, unlike its predecessors, has the resolve and the fortitude to do what is needed and what is right for all Texas students.

Resources

Cárdenas, J.A. Texas School Finance Reform: An IDRA Perspective (San Antonio, Texas: Intercultural Development Research Association, 1997).

Texas Comptroller of Public Accounts. Current and Future Facilities Needs of Texas Public School Districts (Austin, Texas: Texas Comptroller of Public Accounts, October 2006).

Texas Supreme Court. Ruling in Edgewood vs. Meno (January 25, 1995) pg. 49.

Dr. Albert Cortez is director of IDRA Policy. Comments and questions may be directed to him via e-mail at comment@idra.org.

[©2007, IDRA. This article originally appeared in the IDRA Newsletter by the Intercultural Development Research Association. Every effort has been made to maintain the content in its original form. However, accompanying charts and graphs may not be provided here. To receive a copy of the original article by mail or fax, please fill out our information request and feedback form. Permission to reproduce this article is granted provided the article is reprinted in its entirety and proper credit is given to IDRA and the author.]

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