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Allen ISD joins lawsuit over school funding
By Conner Hammett, chammett@acnpapers.com
ALLEN -- Allen ISD has joined a growing number of school districts engaging in litigation with the state of Texas over its school funding system.
The board of trustees passed a resolution agreeing to enter into the litigation at Monday night's workshop meeting. The suit will challenge the constitutionality of the state's school financing system, which saw a $4 billion cut during the last legislative session.
The district will be represented by Thompson and Horton, LLP, a Houston-based law firm representing more than 20 other districts in the lawsuit. The firm plans to argue that the system fails to live up to its constitutional requirements in terms of adequacy and efficiency and that it establishes a de-facto statewide property tax by not providing districts with meaningful discretion over their tax dollars.
"I think that is a definitive action step, that the board is saying, 'Not only did we ask [taxpayers] to step forward with a tax rate increase, we're also telling you we're willing to step forward to help protect that in the future -- protect our ability to have adequate funding to have an efficient system and have some discretion on the tax rate, which we won't have for too long," Helvey said.
One of the district's biggest complaints is efficiency. The target revenue hold harmless system, established in 2006, froze per-student funding at 2006 levels. Many districts, AISD included, have argued the system is arbitrary and leaves huge disparities between districts of similar size and property wealth. Under target revenue, AISD has the lowest amount of allowed per-student spending in Collin County.
"Once [the Legislature] created the target revenue system, the inefficiencies started coming out," Helvey said. "It became clear that districts within reasonably close geographic areas don't have access to the same revenue for the same penny."
The argument for inadequacy is expected to revolve around the increased difficulty districts face in meeting high state performance standards after having their funding cut. The state property tax argument is expected to be based on the fact that many districts -- including Allen -- have exhausted their local taxation options with a Tax Ratification Election and would have no recourse if further funding shortages occur.
Thompson and Horton is one of three groups planning to sue the state on behalf of school districts. The Austin-based Equity Center is suing on behalf of low-wealth districts, while the Texas School Coalition is suing on behalf of high-wealth Chapter 41, or "Robin Hood" districts. More than 300 districts in all are engaging in litigation with the state over the funding system.
AISD was previously involved in litigation over school finance in 2005, when it joined a similar coalition of school districts in West Orange Cove v. Neeley. The court determined that the state's control over local district tax revenues precluded districts from having meaningful discretion over their tax dollars and amounted to a state property tax, which is forbidden by the Texas constitution.
The Legislature responded in 2006 by compressing district property tax rates to $1 per $100 of valuation, with an additional 4 cents of board discretion and an additional 13 cents available with voter approval. Other revenue streams were established in hopes of recouping some of the revenue lost with the tax cuts but they failed to materialize, leaving the state with a deficit it tried to mitigate this session with the funding cuts.
The cuts to public education mean $21 million less in funding to AISD over the next two years. In October, AISD voters approved a 13 cent tax increase intended to offset the cuts, bringing AISD highest possible tax rate allowed by the state of Texas.
The suit will cost $20,000 in district funds and will be covered in full by the district's school finance litigation fund, which contains legal fees awarded to AISD after the end of West Orange Cove v. Neeley. If the new suit is successful, Thompson and Horton has said, districts will be reimbursed for legal fees.
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