Key Texas senators favor statewide property tax

AUSTIN -- With yet another legal challenge to Texas' school finance system expected soon, some key state senators say it is time for Texas to find a lasting fix for the broken system.

Their proposed solution: asking voters to approve a constitutional amendment to authorize a statewide property tax that would replace most of the local school property tax.

Senate Finance Chairman Steve Ogden, R-Bryan, said he knows that just mentioning a possible statewide property tax will stir up emotions. But, he said, "if you go out and ask people for permission, a lot of times they say yes."

Ogden was interviewed by the American-Statesman editorial board. Ogden, first elected to the Senate in 1996, is seeking re-election.

Texas had a statewide property tax, which paid for construction at some state universities, until 1979, when, as part of the reform of the tax appraisal system, voters approved a constitutional amendment eliminating the tax.

By 1991, just a day after the state Supreme Court first ruled that the state's school financing system was unconstitutional, the state's newly elected Democratic leaders -- Gov. Ann Richards, Lt. Gov. Bob Bullock and House Speaker Gib Lewis of Fort Worth -- were calling for reconsideration of the statewide tax. That trial balloon was punctured within weeks. What emerged from the Legislature that session was the first incarnation of the so-called Robin Hood school finance system.

State Sen. Robert Duncan, R-Lubbock, said a statewide property tax wouldn't add to taxpayers' total burden. But it would provide for an equitable and efficient public education system, as required by the state constitution, because the state could distribute the money according to established formulas, he said.

Texans pay for their public schools through state and local tax dollars that amount to nearly $49 billion a year, according to the Texas Education Agency.

Since the most recent adjustment, in 2006, a consensus has emerged across the political spectrum that the system is badly broken.

One example is that per-student funding in Williamson County ranges from $4,600 in the Granger district to almost $6,300 in the nearby Jarrell district.

School districts are expected to sue soon, saying the state has failed to fulfill its constitutional objectives.

In the meantime, Ogden offered a few broad details of the possible constitutional amendment:

Repeal the prohibition on a statewide property tax and allow the state to levy a tax of up to $1 per $100 of assessed property value.

Currently, school districts cannot levy a tax higher than $1.17 per $100 for maintenance and operations, and they must get voter approval to exceed $1.04.

Allow local school districts to levy a property tax of up to 20 cents per $100 of assessed property value for "enrichment" purposes.

Eliminate the Robin Hood system, which requires property-wealthy school districts to contribute to the funding of poorer districts.

Lower the limit -- now 10 percent -- on how much residential property values can increase each year.

"When you say 'statewide property tax,' you're in trouble," Ogden said. "So you're going to have to sell it. It is going to have be a package. But I think that is where we need to go."

To get an amendment on the ballot requires approval of two-thirds of both chambers of the Legislature. And there is plenty in the package to turn off legislators on both sides.

State Rep. Scott Hochberg, D-Houston, said there will be legitimate questions about fairness and local control under this approach.

"I think local school districts very much want the ability to set their own tax rates as high or as low as they choose," Hochberg said.

Senate Education Chairwoman Florence Shapiro, R-Plano, said the idea is one of many under consideration by a special committee on school finance. "We want to look at all options. Everything that is out there we want to bring forward again," Shapiro said.

This report includes material from the Star-Telegram archives.