History Lesson: School-Finance Expert Questions False Premise of Current Budget Plan

A former education chair in the Texas legislature who worked through some of those earlier budget crises offered an important history lesson and some pointed advice in testimony on the education budget today. Former state Rep. Paul Colbert, speaking as a school-finance expert on behalf of El Paso ISD, said in Senate testimony that the current budget discussion is based on “a false premise” and heading “toward a false goal.” Acting as if the task is simply to shrink education funding to fit a cuts-only budget blueprint is a sure path to lower academic performance, Colbert said.

The state back in the 1980s faced a revenue gap as big as the one we have now, Colbert noted, and the solution was a balanced approach including new revenue, not just cuts. That’s also when the state created the Rainy Day Fund, he said, and the whole point of that economic-stabilization fund is to pay for ongoing expenses when revenue drops temporarily during an economic downturn.

Colbert urged use of the entire $9.4 billion in the Rainy Day Fund now to maintain public services while the economic recovery gathers strength. He also recommended another strategy that helped the state weather downturns in 1987 and 2003. In both instances, the state delayed the last installments of school aid for the biennium by a few weeks, pushing them into the next budget cycle when state revenue collections had picked up again. Each time, he said, the strategy worked, as revenue boosted by economic growth enabled the state to catch up on payments to districts while avoiding any permanent cutbacks in their allotment of state aid. This time around, Colbert contended, the state could defer up to $3.8 billion in payments to districts instead of cutting districts’ state funding.

Sen. Robert Duncan, Republican of Lubbock, took issue with Colbert’s recommendations, asserting that these ideas don’t solve the structural budget problem and amount to just “kicking the can down the road.” But Colbert stuck to his guns. The greater danger, he said, lies in making drastic changes in aid formulas that would mean “you’re never going to restore those cuts.”

The Senate Finance subcommittee on public education funding will continue work on this issue for the rest of this week and next. Coming soon will be district-by-district estimates of the cuts in aid that would result from a couple of possible changes in the school-finance system. But all scenarios are bound to be ugly unless lawmakers come up with increased revenue. Just to give you some idea of the scale of this problem, it would take a 30-percent increase in local property taxes to make up the $9.3 billion in state aid that school districts would lose under the Senate’s current budget proposal.