The 86th Legislative session concluded May 27, with lawmakers delivering on a promise made by state leadership back in January: sweeping school finance and property tax reform.
“In my inaugural address I said that this will be the session we enact historical school finance reform by putting more money into the classroom, paying our teachers more, reducing recapture and cutting property taxes,” Gov. Greg Abbott said in a press release. “Tonight, without a court order, the legislature did just that by passing one of the most transformative educational bills in recent Texas history.”
The two bills saw final passage in both chambers Saturday evening. The first, HB 3, was shepherded through the process on the Senate side by Education Committee Chair and Friendswood Sen. Larry Taylor. He said it represents groundbreaking reform for an education system that has lagged behind the changing needs of Texas schoolchildren.
“What we are doing here today ... will move us towards continued prosperity for this state,” he said.
In all, the bill would put $4.5 billion more into the classroom. This money would flow through funding formulas and would direct more to students with economic disadvantages, those still learning English, and those with dyslexia. It would create an optional July term for eligible students and full-day, quality Pre-K programs for students from low-income backgrounds. The only outcomes-based funding in the final version would reward schools for every student they graduate ready for college, the workforce or the military.
Teachers would see a salary increase, but it wouldn’t be the even, across-the-board $5,000 originally included in the Senate version. Instead, it would create a mechanism by which teacher pay would increase whenever the legislature ups the basic allotment, the fundamental variable in school formula funding. HB 3 would raise that more than $1,000, to $6,160, of which nearly a third must go towards salaries for non-administrative public school employees.
Districts would also have the option of developing a system to identify their best teachers and pay them more, but that system couldn’t factor in results from state accountability tests. There are also incentives for teachers who are willing to teach at high-need or rural campuses. Administrators will have flexibility in how those funds get distributed, so the actual amount of increased pay will vary district to district. In all, the bill puts about $2 billion toward teacher and other public school salary increases.
The bill would also reduce local school property tax rates by an estimated 13 cents per $100 valuation by 2021, providing more than $5 billion in property tax relief within two years. It also seeks to rein in rate growth by requiring districts to seek voter approval if they wish to exceed a 2.5 percent rate increase in any year.
SB 2, by Houston Sen. Paul Bettencourt, would create a similar limit for most municipal tax rates, at 3.5 percent. That bill also includes a number of transparency and taxpayer education provisions. If voters approve no rate increases above these new limits, it would save an estimated $980 million in property taxes statewide by 2024.
“This is astonishing tax relief,” Bettencourt said of the two bills.
Following passage of both measures, Lt. Gov. Dan Patrick thanked the Speaker of the House, the Governor, and both chambers for working together to accomplish a landmark session.
“This is truly a historic evening,” he said. “It’s going to save taxpayers a lot of money, give teachers more money and change the way we educate students and finance and make us number one in the country to lead on education reform.”
Other key bills passed by both chambers this session (Senate author/sponsor in parentheses):
• HB 1 - (Nelson) The state budget. The final version appropriates $164.2 billion in state money to pay for services through 2021, including the tax and education reforms passed in SB 2 and HB 3. Other highlights include: funding to increase capacity at state drivers’ license offices, funding to dispose of the backlog on sexual assault kit testing, $7.8 billion in mental health program spending across 23 state agencies, and $347 million for women’s health programs.
• SB 500 - (Nelson) The supplemental budget, truing up accounts between what was appropriated in 2017 and actual costs. Includes $3.5 billion in rainy day funds to assist with Hurricane Harvey relief and recovery as well as $800 million to offset lost property values for school districts in the disaster area.
• SBs 6, 7, & 8 - (Kolkhorst/Creighton/Perry) Comprehensive Harvey relief and recovery package. Leverages expertise at state institutions to improve disaster response and train local officials (SB 6). Creates a funding structure to pay for flood mitigation and prevention projects, pull down federal matching funds, and cover other costs associated with hurricane relief. (SB 7). Creates a statewide flood planning system that coordinates regional plans for the first time (SB 8).
• SB 11 - (Taylor) School safety plan developed in the wake of the 2018 Santa Fe High School shooting. Requires districts to develop safety plans for each campus, implements facility hardening standards and requires safety committees for individual campuses. The Texas School Safety Center in San Marcos will evaluate plans and offer logistical support to districts. SB 10 (Nelson), which creates the Texas Mental Health Consortium, was amended onto this bill in the House. That measure allows mental health professionals at state medical schools to consult with pediatricians and other providers on mental health issues affecting children. Also includes suicide awareness and prevention programs for students and training for teachers from SB 1390 (Menéndez).
• SB 12 - (Huffman) Provides long-term fiscal stability for the state teachers’ retirement system through gradual increases in contributions from active employees, school districts and the state over the next six years. Also provides for a 13th bonus annuity check up to $2,000 for beneficiaries this fall.
• HB 2048 - (Huffman) Repeals the state drivers responsibility program, a system that adds additional penalties to drivers who exceed a certain number of traffic violations in a year.
• SB 1264 - (Hancock) Consumer protections against surprise medical billing for state-regulated health insurance plans. Effectively prevents the practice in cases where a person has no say in who is treating them, such as in an emergency room. Patients would still be responsible for deductibles, co-pays, and other expected costs at in-network facilities, but no more.
• SB 21 - (Huffman) raises the age required to purchase tobacco or other nicotine products like vaporizes from 18 to 21
• HB 1631 - (Hall) bans the use of red light cameras in Texas
• HB 3906 - (Taylor) State STAAR accountability test reforms that move the test to a shorter, online version over five years, intended to reduce test-taking time, stress and instructional time lost to testing.
Per Texas Legislature Online, 7,324 bills were filed in the House and Senate, and 1,419 passed both chambers. The governor has up to 20 days to veto any bills of which he disapproves. Otherwise, any unsigned bills can become law absent his signature.
The Legislature is scheduled to reconvene again in January of 2021, when lawmakers will see how well these education and property tax reforms worked over the 19-month interim. Until then, the Legislature stands adjourned sine die.