Resource Center

• by Albert Cortez Ph.D.• IDRA Newsletter • January 2012 •

In response to the Texas Legislature’s failure to provide appropriate funding for public education, four different groups have filed suit challenging the constitutionality of the state’s school funding system.(See Texas Taxpayer & Student Fairness Coalition Original Petition, Lawsuit Filing)

The Equity Center-supported Taxpayer and Student Fairness Coalition has the largest number of school district plaintiffs – 380 school districts so far. The named plaintiffs include the coalition (which is a non-profit group), the school districts of Hutto, Nacogdoches, Plugerville, San Antonio, Taylor and Van, as well as individual taxpayers from selected school districts and parents of students enrolled in one of the plaintiff districts.

A group of about 40 above-average wealth school districts, sometimes referred to as Chapter 41 districts, is represented by the law firm of Boone and Haynes. Their named plaintiffs include
Calhoun County, Abernathy, Arkansas Pass, Frisco, Lewisville and Richardson school districts. (See Haynes & Boone Original Petition)

A group of low-wealth school districts and parents is represented by the Mexican American Legal Defense and Educational Fund (MALDEF). The plaintiffs include a number of school districts as well as parents and taxpayers around the state, with the possibility of additional plaintiffs being added in the future. The named plaintiffs include Edgewood, McAllen, San Benito and La Feria school districts and taxpayers and parents from other selected school districts. (See MALDEF Original Petition)

A group of large urban school districts represented by the Thompson & Horton firm lists 63 distinct school district plaintiffs among them Abilene, Amarillo, Austin, College Station, Cypress Fairbanks, Dallas, Fort Worth, Houston, Midland, Northeast (in San Antonio), Northside (in San Antonio), Pasadena, Round Rock, Waco and West Orange-Cove (the lead district in the 2005 school finance litigation). (See Thompson & Horton Original Petition)

It was predicted that the Texas Legislature’s drastic cuts would lead to a new court challenge from the state’s public school districts, but few imagined that the reaction would involve such a diverse and large number of communities from throughout the state. The combined enrollment of the 60 or so large school districts that have joined the litigation numbers well over 1 million students. Adding in the students enrolled in the other three plaintiffs’ schools brings the total to close half of the state’s total student enrollment. And almost half of the state’s school districts are involved in the various suits. The fact that the plaintiffs include such large numbers of school districts and students reflects an overall disgust with the state legislature’s poor handling of the school funding crisis in the 2011 session.

Law Suit Areas of Focus

While four different groups are attacking the legality of the existing public school funding scheme, there is a good deal of similarity in the claims being raised against the state, with some limited divergence among one or two. A summary developed by the Equity Center (2011) and updated by IDRA shows the distinctive areas of focus contained in each of the various claims filed to date.

Equity & Efficiency

The Equity Center and MALDEF claims are similar in that each is challenging the extent of funding inequity created by the current system. Each presents examples of the great disparities in funding available to low wealth school districts compared to high wealth school districts. They also both note that these disparities exist despite the fact that low wealth school districts exert high tax efforts but still yield significantly less in funding per student than their wealthy school district counterparts. The suit filed by the group of mostly large school districts (Thompson & Horton) makes similar points about the extent of funding inequity created by the state’s funding mechanisms.

Local Discretion

All groups raise the fact that more than 200 school districts have used all available local maintenance and operations (M&O) taxing authority to meet state mandates. Since these school districts have maxed out their tax effort to the state-allowed $1.17 maximum, they are left with no “local discretion” as required under the West Orange-Cove court decision in 2005.

MALDEF further asks the court to allow the state to maintain a tax cap for purposes of achieving equity. The group of wealthy districts (Haynes and Boone) note that the lack of adequate funds coupled with tax limits hinders the ability of school districts to provide meaningful local discretion. They go on to claim that school districts that must contribute part of the funding raised by local supplemental tax efforts (tax rates above the $1.00 level required to fund the Foundation Program) have a more difficult time prevailing in local tax ratification elections than those that are not subject to recapture.

Target Revenue

The groups also seem to agree that the state’s over-reliance on Target Revenue – which is the loophole mechanism used to determine funding for three-quarters of all school districts – makes the system irrational in that there is no connection between a district’s tax effort and its return, as mandated under the court’s earlier rulings.

All groups criticize the excessive dependence on Target Revenue and note that it locks school districts into per student funding tied to 2006 levels, despite changing student populations and increasing state requirements that include more challenging state curricular requirements and the important goal of having all Texas students be college ready upon graduation.

Adequacy and Suitability

An area where the groups differ slightly is that, while the Equity Center complaint focuses on the lack of adequate funding for all students, the MALDEF complaint targets the state’s under-funding of programs serving low-income students and English language learners – two groups that have suffered persistent under-funding since the system converted to a weighted funding approach in 1984.

The Thompson & Horton group makes similar claims, noting that many of the funding mechanisms date back several decades and are not based on actual costs involved in delivering mandated education programs to all students. In its petition, the Thompson & Horton filing includes as part of its requested relief that the state be required to conduct studies on the actual cost of education with input from the plaintiffs to help guide future state funding and equalization efforts.

All plaintiffs allude to the extent of funding inadequacy in the state system, noting that while the state has increased standards, it has not provided school districts with commensurate increases in funding to enable them to provide programs that help students meet with higher standards.

Plaintiffs also remind the court that it had warned the state about the levels found to be “adequate” at the time of the 2006 ruling and that recent budget cuts, coupled with increasing standards, brought state funding levels below that former bar.

Federal Equal Protection

The Equity Center’s challenge is the only plaintiff that alludes to possible violations of the Equal Protection Clause of the U.S. Constitution.

What’s Next

As expected, the Texas Attorney General’s response consisted of a brief denial of all plaintiff’s claims and demanded “proof by a preponderance of evidence.” It is expected that the district court that will hear the case in Austin may not begin hearings until the fall of 2012, in part because of the amount of time that will be needed to conduct the related studies and gather the evidence that will be needed by both sides in the case. Were that to happen, the district ruling may not come until sometime late in the year, with an appeal to the Supreme Court almost guaranteed. If the Texas Supreme Court hears oral arguments in the case in early 2013 in the midst of the next Texas legislative session and if it rules (as expected) that the system must be altered, then a special session sometime in mid to late 2013 is a strong possibility.

Last summer, IDRA presented testimony before the U.S. Department of Education’s Equity and Excellence Commission, stating: “This state and this region have a long and tarnished history of failing to provide equal educational opportunities for all children” (June 8, 2011). Many times over the last almost four decades, IDRA has provided expert testimony and analyses for court cases regarding school funding, particularly in Texas. As we enter another round of litigation, IDRA will continue to provide support and data analysis. In addition, through our Fair Funding Now! initiative, we will share news with community leaders across the state (see the story on Page 3). See the box on Page 2 for ways to receive news and updates of activities community groups are taking.

Education is a state responsibility according to Article VII of the Texas Constitution. That responsibility includes ensuring access to equitable funding for all students attending Texas public schools. We cannot have excellence in Texas without equity.

Resources

Calhoun County Independent School District, et al., vs. Scott. Original Petition, lawsuit filing (Haynes & Boone, December 9, 2011).

Cortez, A. “Fair Funding of Texas Schools is Even More Critical in Tough Economic Times,” IDRA Newsletter (San Antonio, Texas: Intercultural Development Research Association, May 2010).

Edgewood Independent School District, et al., vs. Scott. Original Petition, lawsuit filing (MALDEF, December 13, 2011).

Equity Center. The ECXpress (Austin, Texas: Equity Center, November 1, 2011) Vol. 3, No. 7.

Fort Bend Independent School District, et al., vs. Scott. Original Petition, lawsuit filing (Thompson & Horton, December 22, 2011).

IDRA. Opportunity Matters: The Call to Increase Excellence and Equity, testimony presented to the U.S. Department of Education, Equity and Excellence Commission (San Antonio, Texas: Intercultural Development Research Association, June 8, 2011).

Texas Taxpayer & Student Fairness Coalition vs. Scott. Original Petition, lawsuit filing (Equity Center, October 11, 2011).

Albert Cortez Ph.D., is director of policy at IDRA. Comments and questions may be directed to him via e-mail at feedback@idra.org.

[©2012, IDRA. This article originally appeared in the January 2012 IDRA Newsletter by the Intercultural Development Research Association. 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.]