This is the second article of a three-part series on school finance, LISD budget process and future financial challenges.

    In the previous column, I shared the history of school finance and the most recent funding changes by the state legislature.  Our district applauds our legislators’ commitment to local property tax relief – it was a long time coming.  

    However, I am disappointed our legislators didn’t have the same focus in funding our public schools in a truly meaningful way by implementing a long-term, sustaining revenue generating alternative. 

    Even though LISD was identified as a Chapter 41 school district under the previous funding system, which meant our district was required to send money to the state for redistribution to property poor school districts, we were able to keep additional tax dollars generated by area growth. On average, our community’s property values increased by approximately $2 billion annually.  From the $2 billion, LISD would receive about $15 million new dollars annually, which helped LISD survive from year to year.  These dollars allowed the district to hire teachers to keep up with growth, fund competitive teacher salaries allowing the district to recruit the best hires, provide a minimum three percent raise for teachers and staff (LISD has 6,000 staff members) and keep up with inflation.

    While the “Robin Hood” plan wasn’t ideal, it did allow our district to keep the additional dollars generated by growth. Without keeping these dollars, LISD and other districts can’t survive. In fact, every school district in Harris County, located in the Houston area, adopted a deficit budget. This clearly demonstrates this new funding system isn’t a fix.  

    Under the new system, LISD receives an amount per student, which doesn’t factor in the growing enrollment, rising costs of living and increasing utility and insurance costs.  The state also doesn’t consider cost of living by location and each district receives different amounts per student.  This new funding system was based upon relieving property tax owners and equalizing funding.  

    While this is worthy concept, it doesn’t work.  The cost of living in the Dallas/Fort Worth area is much more expensive than in the Houston area.  The needs for a rural community are drastically different than a suburban or urban area.  What is the true fix? There are three elements that must be addressed, which include:

•    Find a sustainable funding formula
•    Equalize the target revenue per student and recognize it must be adjustable from year to year based upon a district’s location and inflation
•    Recognize there is no such thing as a “one size education program fits all”

    Throughout the remainder of this school year, communities will continue to hear through the media about the drastic cuts districts are forced to make as its budgeting processes begin.  Even with slashed budgets, districts aren’t able to balance its budgets without going into reserved accounts.  In many cases, school districts have minimal funds in reserved accounts.  The state recommends each district have an account known as fund balance with at least three months of operating costs.  The majority of our school districts can’t afford to have three months operating expenses when necessary programs and services are on the chopping block.

    In the last article in the three-part series, I will share how LISD is weathering this financial storm and what we are doing to ensure that we continue to provide the necessary programs for our students to continuing achieving success.