The Austin Independent School District budget this year is $1.6 billion. However, the district taxpayers also paid an additional $670 million that AISD was forced to forfeit to the state through the “Robin Hood” tax recapture policy.
The idea is egalitarian in theory –– it shifts money from districts with high property values to the state, which then redistributes it to property-poor districts. Except it doesn’t seem like the ever-increasing recapture revenue translates into increased funding for other districts (this article offers a good explanation). Mostly it just seems like the state is taking Austin’s money and then reducing its own spending on public education. And the formula doesn’t account for the fact that some property-rich urban districts also have high levels of poverty.
As Mayor Steve Adler likes to point out, it is the state that is fueling property tax increases by taking away so much of our revenue. Plenty of right-wingers agree with him.
Some conservative group that –– based on its members –– should have some sway with state GOP leadership, has offered a solution: Get rid of Robin Hood in exchange for strict taxing limits for local governments. From the Quorum Report:
Passage of tax and expenditure caps on local and state government could be a significant step toward eliminating Texas’ so-called Robin Hood system of school finance, the “Conservative Texas Budget Coalition” argued this morning.
Tax and expenditure caps have been a biennial topic for at least a decade at the Texas Capitol.
Tying that effort to a school finance solution – and eliminating the need for property-wealthy school districts to return tax dollars to the state – is something new.
The Conservative Budget Coalition is a who’s who of Koch/Bradley Foundation beneficiaries.
It looks like the limit the revenue limit this group is pushing for is 2.5% increase per year. That’s down from the current 8% limit. Keep in mind, this is not an increase in the tax rate. It’s the increase in property tax revenue the jurisdiction is allowed to collect (it naturally increases when population & property values are rising).
I’m not smart enough to do the math on this, but at first blush it seems like districts like AISD that have been sending such a large percentage of their revenue to the state would find this deal pretty tempting. And remember, it’s not just the big blue urban districts dealing with this issue. In 2016, the Eanes School District (West Lake and rich people in West Austin) paid more to recapture ($82.9 million) than it spent on its school district last year ($72.4 million).
If I were in charge of AISD, I’d be tempted to take the additional $670 million now and hope that by the time we really need to increase revenue (a few years down the line), the state legislature will be in Democratic hands.
For city and county governments, however, this is a completely different situation. They get nothing from the end of Robin Hood except for the fact that there will presumably be fewer needs in the community if the school district has more money to spend.
A 2.5% limit would be devastating for the city of Austin and Travis County. The metro area’s population is increasing at about 3%. So not only do you have expand services to accommodate that increased population, but you have to have money left over to keep your employees’ wages up with the cost-of-living.
At the end of the day, the folks backing this plan are doing so because they know it will lead to decreased spending on public services. They wouldn’t support it if they didn’t believe that would be the long-term result.