Texas Districts Spend $5 Billion In Property Taxes To Fund Other Schools

Cynthia Velazquez waits for her child outside Central Middle School. Velazquez said the school has changed since she graduated from the Galveston Independent School District, but her child’s decades-old structure needs further changes.

I attended. “I went to all the schools, and they were all good,” Velazquez told 13 Investigates. “They have been upgraded, but it still kind of looks the same.”

If it could keep all of the millions in property taxes homeowners pay for education, Galveston ISD could renovate schools, build new ones, and enhance teacher salaries. Local property taxes per student are limited in Texas. Rest is “recaptured” and returned to the state.

Galveston ISD must send the state extra property tax revenue if it collects more than the basic amount per pupil. The state redistributes such money to districts that don’t collect enough taxes to fund enrollment. Advocates argue it ensures all students receive the same basic funding regardless of where they live.

“Property values across the state vary dramatically from school district to school district, and if we didn’t go in and equalize funding between districts, we’d have some districts that are only able to raise maybe $1,000 (or) $1,500 per student with their tax rate while other districts can raise $14,000 or $20,000,” said Chandra Villanueva, director of policy and advocacy at Every Texan. “If we didn’t level it off between the two districts, we’d be asking them to offer the same education at very different levels of resources.”

Texas Districts Spend $5 Billion In Property Taxes To Fund Other Schools

As part of Recapture or the “Robin Hood” plan, Galveston ISD is returning 43% of property taxes to the state this year instead of spending them on public schools. The Texas Education Agency reported that 34 school districts paid $131 million to the state in 1994 for collecting more property taxes than they were allowed.

“When more dollars from recapture or come into the system, that means that the state can put less of its general revenue in to support schools instead,” said Texas School Coalition executive director Christy Rome. “What they do with the general revenue that they’re able to save because they don’t have to use it for schools, we really can’t track and know, so I think that for many schools, they feel like they’re sending in additional dollars through Recapture and Robin Hood, but yet schools in the state are not seeing increased funding as a result of it, and we really can’t see what the state is doing with that money either.”

Investigates Interactive: Want to know if your school district is recapturing or “Robin Hood” funding the state? Find your district on the map. If your district isn’t on the map, it’s not paying local taxes to the state this year. On mobile? Fullscreen here. The TEA says greater property taxes don’t imply more school funding. The TEA said districts receive local and state funds. The TEA declared 100% of local property taxes must “stay in public education,” making them the foremost financing source.

Lottery and tax money fill the entitlement bucket’s leftover funding. Property value growth increases recapture, which reduces state money needed to attain the entitlement level of per-student financing. Property tax relief by the legislature reduces recapture, requiring more state funds to fill the cup. “In both cases, this is a question of how public education entitlements will be paid for, not how much districts will receive,” the TEA told 13 Investigates.

State data reveals 185 school districts are paying over $1 billion more than last year. Despite 80% of Galveston ISD kids being economically disadvantaged by state standards, the city is property wealthy. According to the Texas Education Agency’s 2022-23 planned financial data, Galveston ISD would collect $103 million in local property taxes. However, the district had to recapture $44 million. Ten years ago, the district only owed $11 million to the state. You must keep reading for more on this breaking story about The House Bill that Would Require Parental Authorization For Texas Minors To Create Social Media Accounts.

“We’re being penalized for something that’s really out of (our) control,” Galveston ISD Superintendent Dr. Jerry Gibson told 13 Investigates. It’s beyond our 6,700–6,800 pupils’ control. Nobody’s fault that we’re property rich. It is. Great tourism. We have the Port of Galveston, you have magnificent beach houses, and that’s not our children’s fault, but who pays the price?”

The TEA expects Houston ISD to recoup $247.4 million in property taxes this year. State data reveals Cypress-Fairbanks, Katy, Fort Bend, Conroe, and Aldine independent school districts aren’t projected to recoup property taxes.

Districts Are ‘Not Adequately Funded’

‘Not properly supported’ communities Some lawmakers and education advocates worry the state isn’t contributing enough.

“The true solution to recapture is the State of Texas doing its constitutional duty in paying for public education,” said State Rep. Mihaela Plesa, D-Dallas.

Plesa has introduced multiple proposals this session to limit recapture and preserve property tax revenues in local schools rather than moving them to other districts. The senator said she wants local school districts to pay less money to the state “not about not wanting to help other school districts.” Plesa wants Texas’ five million public school pupils to have equitable educational chances, but the state needs to stop “defunding education.”

Our money must be tracked. “I pay my property taxes every year, and I’m assuming that money is going to pay for teachers, retired teachers, school buildings, to protect my kids and make sure they’re getting a fulfilling education,” Plesa said. “I’m finding out that most of that money is going into general revenue, so our ‘tax-parency’ measure… will simply display the receipts that show people where the money is going. My school district? Is it being returned to the state and used to build a wall?

Advocates suggest enhancing per-student funding to help recapture districts keep more local property tax dollars. We got more Texas news related to Texas Senate Adopts $308 Billion Budget Package, Starting High Stakes House Deliberations.

“(Recapture) is really an equity tool that’s about leveling the playing field between districts, and what a lot of people get confused about is the concept of equity and adequacy,” Villanueva said. “What we have is a somewhat equitable system because of the recapture program, but we don’t have adequate funding, so people get upset when they pay recapture because they’re not adequately funded, and that’s what we’re really trying to address, is how well our schools are funded.”

The Texas Education Agency says “the basic allotment is the legislatively mandated apportionment of funds from the general revenue funds that goes to each school district to provide a basic level of education for the district’s residents.” The Texas Education Code mandates $6,160 per student. Student variables like special education or socioeconomic status determine the district’s rise.

The $6,160 basic student allocation hasn’t increased in four years. The allowance increased 20% from $5,140 per student in 2019-20. When asked if it favors increasing that amount, the Texas Education Agency said it “can’t comment on pending legislation.” School funding may alter. A roughly $4.5 billion school finance bill passed the House this week, giving districts $90 per student in 2024. The bill awaits Senate approval.

“Unless the state raises the formula amounts, like the basic allotment and other things in the formula, public education really has no more money to spend than they currently have, so just doing away with recapture doesn’t fix anything in terms of the state funding system,” said Ray Freeman, executive director of The Equity Center, a nonprofit that represents over half of the state’s school districts”.

Gibson said he wishes Galveston ISD didn’t have to send millions back to the state because the money could go into teacher salaries, better facilities, and more after-school programs for needy students. You mention a parent who works two jobs to feed and light their kids. They would know that although I’m working my second job, my child is still at school, so we can afford afterschool programs that feed them. Instruction will increase. Gibson said they’d have the energy to burn.

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