What the pesky little chart left out of the public education tax picture

Passing period at United South High School in Laredo. Photo by Rachel Zein for The Texas Tribune

There’s a chart making the rounds at the Capitol and in newsrooms. It purports to show that state funding for public schools is dropping (in constant dollars) and it’s being used to make the argument that Texas is underfunding its schools.

But the chart, released by the Legislative Budget Board, leaves out a significant part of the total public school revenue picture — and includes one-time federal funding.

Nonetheless, some are using the chart to make the claim that revenue for public education has decreased from $44 billion in the 2010 base year to $41.2 billion in 2019 in constant dollars (which are calculated by adjusting the revenue for state population growth and inflation over time).

But included in the $44 billion base year amount is $2.4 billion of one-time money from the American Recovery and Reinvestment Act of 2009 under the Obama administration.

If this one-time infusion were not included in the chart, we would see that funding for public education — in constant dollars — hasn’t dropped much over that period of time.

The chart also excludes billions of dollars of local property taxes that are collected each year to pay for bonds that are used to finance school facilities, and additional amounts for teacher pensions.

It’s not just the revenue that’s rising. Taxpayers know they’re paying more and more for public schools; they see their tax bills each year. No chart is going to convince them otherwise.

The problem with that “pesky chart,” as the Texas Tribune’s Ross Ramsey calls it, is that it feeds into a narrative that is wrong.

Here’s that narrative: Texas taxpayers — hardworking families and businesses — don’t spend enough on public schools at the “state level;" poor school districts are hit hardest by underfunding; and if taxpayers just spent much more at the “state level,” then student outcomes would be improved.

None of those things are true.

First, let’s look at the appropriate total public education revenue picture. In corrected dollars, per-pupil funding in Texas is up over the last decade. Data from the Texas Education Agency shows that per-student funding increased from $9,423 in FY 2007 to $11,349 in FY 2017 — an increase of about 20 percent. And total funding has risen from $43.1 billion to $60.6 billion in that same time period, for an increase of 41 percent.

In per-pupil spending, Texas is not at the top of the states. But neither is it at the bottom — it’s not even close. Texas is close to the national average of $11,762 (the average is given by the Census Bureau).

Besides, Texas should not be racing to implement big state tax increases so that we can brag that we spend more than New York and California. They spend more on public education, but generally have worse student achievement for minority children and economic growth than Texas.

We should be racing to determine how Texas can improve its student outcomes using existing tax dollars.

Some high-poverty school districts in the Rio Grande Valley — including Alamo ISD, Edinburg CISD and Valley View ISD — are getting relatively good results.

In Edinburg CISD, for example, 86 percent of students come from economically disadvantaged families. Edinburg CISD spent just $10,881 per student last year, less than state and regional averages, but it had relatively better test scores than similar district (with a high percentage of economically disadvantaged families) that are spending more money.

What if the Valley’s best practices could be replicated statewide at relatively little cost and with no tax increase?

The Texas Education Agency — based on data for Texas spending and student results — along with the Texas Supreme Court recognize there is no significant relationship between spending and education outcomes. And outcomes — not context-less budget figures — should be our focus.

Second, education administrators are complaining we need to spend more on education at the “state level,” and that the state is not paying its fair share. Some are even suggesting we must increase state spending to match local property tax collections.

But in order for state spending to match local property taxes, the state would have to spend an additional $11 billion per year on public education. That means the state’s general revenue budget would have to be increased by more than 20 percent, meaning our taxes would go up substantially.

The taxes collected at the state level are paid by the same families and businesses that pay skyrocketing local property taxes.

But we are not going to tax and spend our way into improved student outcomes. In the last 10 years, taxpayers have piled on billions of new dollars to public education yet student reading results have declined.

It’s far more important what we spend money on, than how much we spend it. We know that school districts could improve student results if they paid effective teachers more and kept them in the classroom helping kids.

So before the Legislature enacts a big statewide tax increase, which would harm hardworking families and businesses with no easily discernable benefits to students, lawmakers should ask the hard questions. Are we getting our money’s worth? Can we use our education funds more wisely? And are we focused on saving a system, or saving our kids?

Disclosure: The Texas Public Policy Foundation has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune's journalism. Find a complete list of them here.

Kara Belew

Senior education policy advisor, Texas Public Policy Foundation

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