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The Texas Supreme Court School Finance Ruling

May 16, 2016 by

by James Windham –

The Texas Supreme Court, in a long-awaited ruling, has concluded in a decision without dissent that the Texas public school finance system, while deeply flawed, “satisfies minimum constitutional requirements”.  In the opinion written by Justice Don Willett, the Court declined to usurp legislative authority by issuing systemic reform dictates, but upheld the trial court’s ruling that the finance system is inefficient and overregulated, with both of which points I strongly agree.  Further to these points, Willett wrote “Texas’ more than 5 million school children deserve transformational, top-to-bottom reforms that amount to more than band-aid on top of band-aid; they deserve a revamped, nonsclerotic system fit for the 21st century”.  So the ball is back in the court of the Texas Legislature, which is where it should be.

The organization I chair, the Texas Institute for Education Reform (TIER), was strongly supportive of Texans for Real Efficiency and Equity, the plaintiff in the case pleading for a ruling in favor of the constitutional mandate for efficiency in school funding, and we submitted an amicus brief in which I wrote as follows:

These laws {Chapter 21, Texas Education Code} and regulations in many instances cause gross inefficiencies in the allocation of education resources, particularly in the inefficient management of human resources, resulting in waste which is forced on every school district in the state directly as a result of the micromanagement of state mandates.  Billions of taxpayer dollars are wasted each year in large part due to these unnecessary mandates which actually inhibit productivity.  These mandates are promoted by special interests and are designed almost exclusively to protect adult stakeholders.  Many of the provisions of Chapter 21 (human resource regulation) harm Texas schoolchildren, are costly to taxpayers, and make the entire system of public free schools inefficient. An efficient system would allow wide-ranging authority at the district level, with deregulation of human resource management under the long-standing principle of authority commensurate with responsibility for results.

And while we didn’t get a specific mandate for regulatory reform, it is clear that the Court feels strongly that the Code is in need of serious overhaul.

We must spend education dollars much more efficiently and productively. In all of the current and recent litigation on school finance, we must ask ourselves, which is the most important consideration—adequacy, equity, or efficiency?  I submit the following:

(1) aggregate statewide funding is adequate and, in fact, public education funding from all sources over the past 17 years has increased significantly more than the increase in enrollment and inflation combined, even when adding a factor for the growth in special needs students;

(2) over the period 1998-2013 public education operations spending increased 116%, debt service expenditures 289%, while inflation totaled 42% and enrollment growth 32%.

(3) granted, equitable funding is questionable in many ways, including between administration and the classroom, between and among many rural and urban areas, and between traditional and charter schools;

(4) the current “Robin Hood” finance system has been a failed attempt at equity, but there will be constant periodic adjustments absent a statewide solution to the revenue model;

(5) the constitutional mandate for school “efficiency”, properly defined as productivity, should have priority in driving the school finance debate.

Let’s face it—the current education delivery system is not sustainable.  We cannot continue to finance this top-down, compliance and input driven system.  Only when we replace it with a more competitive, deregulated, and innovative system that incentivizes educators and enables productivity with true financial accountability will we know what funding adequacy and equity really mean.  No court can or should make this determination.

Source: Special Edition: The Texas Supreme Court School Finance Ruling

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