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Stealing from the rich? State's 'Robin Hood' plan may take away school districts' wind energy tax increases

Wind turbines are generating more than electricity in Coke County. They're also producing significantly more tax dollars for the Robert Lee Independent School District. And that's the problem. Under the state's "Robin Hood" school funding formula that takes from more affluent and gives to less affluent districts, Robert Lee ISD could end up benefiting little from the cash windfall. ...Under the present system, the state "recaptures" funds from property-wealthy districts and uses them to assist with financing public education in school districts deemed property poor.

Wind turbines are generating more than electricity in Coke County. They're also producing significantly more tax dollars for the Robert Lee Independent School District.

And that's the problem. Under the state's "Robin Hood" school funding formula that takes from more affluent and gives to less affluent districts, Robert Lee ISD could end up benefiting little from the cash windfall.

In Robert Lee ISD, district officials are preparing to deal with its new state-generated, share-the-wealth -- or Chapter 41 -- label.

"This year we should not have to shift money," Robert Lee ISD Superintendent Aaron Hood said, "but in the upcoming years, we could have to shift over $1 million per year."

Under the present system, the state "recaptures" funds from property-wealthy districts and uses them to assist with financing public education in school districts deemed property poor.

While his district's $2.8 million annual budget will likely be considered Chapter 41 "by name only" in 2008-09, Hood said he anticipates it will lose revenue to the state in 2009-2010 because "our numbers are projected to be well over" the state's current benchmark of $319,500 in property valuation per student.

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Wind turbines are generating more than electricity in Coke County. They're also producing significantly more tax dollars for the Robert Lee Independent School District.

And that's the problem. Under the state's "Robin Hood" school funding formula that takes from more affluent and gives to less affluent districts, Robert Lee ISD could end up benefiting little from the cash windfall.

In Robert Lee ISD, district officials are preparing to deal with its new state-generated, share-the-wealth -- or Chapter 41 -- label.

"This year we should not have to shift money," Robert Lee ISD Superintendent Aaron Hood said, "but in the upcoming years, we could have to shift over $1 million per year."

Under the present system, the state "recaptures" funds from property-wealthy districts and uses them to assist with financing public education in school districts deemed property poor.

While his district's $2.8 million annual budget will likely be considered Chapter 41 "by name only" in 2008-09, Hood said he anticipates it will lose revenue to the state in 2009-2010 because "our numbers are projected to be well over" the state's current benchmark of $319,500 in property valuation per student.

Located about 68 miles southwest of Abilene, it is one of a record number of Texas public school systems expected to be identified as share-the-wealth districts during this school year.

The Texas Education Agency recently alerted 269 of the state's 1,031 districts -- including Robert Lee ISD, Highland ISD and a number of other Big Country districts -- that they have been named among the more affluent districts because they exceed the state's current $319,500 benchmark in property valuation per student.

The number of districts notified statewide this year is roughly 15 percent more than the 234 districts listed last year.

However, the anticipated number of districts subject to "recapture" from the state in 2008-09 is 85 -- up only slightly from the 78 such districts in 2007-08, said Wayne Pierce, director of the Equity Center, which represents low-wealth districts.

Pierce does expect the number of districts required to share their wealth to increase -- as well as the dollar amount given up -- as a "natural consequence of the state setting the recapture level and equity level at a fixed yield."

"The yields must rise in concert with the increase in the state's wealth," Pierce said. "This will enable a (low-wealth) district to keep up with inflation and increasing standards without raising tax rates."

Districts prepare to share

While the wind turbines are "good for our community and land owners" and are, nevertheless, welcome additions, Hood said his district -- Robert Lee ISD -- will "see little benefit" on the management and operations side of the budget from the turbines "due to the school finance system."

"The perception of almost everyone in the state is that higher property values lead to increases for school districts, but that is not the case with the finance system that is in place now," Hood said.

Hood said school districts such as Robert Lee ISD have a number of options on where to send the "excess" money, including -- but not limited to -- consolidating with another district, contracting to educate nonresident students and consolidating tax bases with another district.

While Robert Lee ISD and six other Big Country districts aren't impacted immediately, Nolan County's Highland ISD and eight others area districts are among districts likely required to share their wealth this school year.

Guy Nelson, superintendent of Highland ISD, said his district has become a share-the-wealth district with the significant increases in property values because of new wind energy farms that have been developed within the district's borders.

Nelson, however, said after the wind farm property tax values peak during the 2008-09 school year, they are expected to decline as a result of agreements between Highland ISD and the wind energy companies.

Consequently, he said, HISD may fall below the state's benchmark for Chapter 41 schools by the 2010-2011 school year.

Other districts, such as Kent County's Jayton-Girard ISD, are continuing to be considered share-the-wealth districts.

Still others, such as Gordon ISD in Palo Pinto County, are bracing to be named as being such in the future.

"That will probably change next year," said Jon Hartgraves, superintendent of Gordon ISD.

Tim Seymore, superintendent of Jayton-Girard ISD, said his district has been considered "wealthy" since the beginning of the "Robin Hood" era around 1992 because of revenue generated from taxes on oil businesses.

"No school is particularly happy in the current finance system because that target revenue level set by the state means no new money unless the district has an increase in enrollment," Seymore said. "There are not many West Texas districts that are experiencing enrollment growth."

During the 2008-09 school year, Jayton-Girard ISD will collect nearly $7 million in local property taxes and pay nearly $4.5 million to the state in "recapture," Seymore said.

In 2007-08, Seymour said his district surrendered $3.5 million in recaptured funds, but the district still has been able to maintain a current fund balance, or reserve, of about $6 million.

Amounts expected to grow

Altogether, through the state's "Robin Hood" school funding formula, some estimates indicate the amount of property tax revenue surrendered by share-the-wealth districts could reach as high as $1.5 billion during the current school year, a jump from about $1 billion during last school year.

Some lawmakers and other officials continue to call for the system to be revamped, noting that district budgets are being squeezed with increasing fuel and other costs and that some districts, as a result, are being forced to consider raising property rates above the current $1.04 per $100 valuation rate.

Opponents of the current system say, however, that it is hard to convince voters to raise property tax rates after voters realize the newly generated money will be taken away by the state and given to other districts.

Proponents of the current system, on the other hand, contend it attempts to clear up historical funding inequities between the state's more affluent and less affluent districts.

 


Source: http://www.reporternews.com...

AUG 25 2008
http://www.windaction.org/posts/16718-stealing-from-the-rich-state-s-robin-hood-plan-may-take-away-school-districts-wind-energy-tax-increases
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