By Tim Brown, County Information Senior Analyst
It was bound to happen sooner or later, but it looks like school finance has, once again, become the topic of the day – or should I say the topic of the session? While different interest groups argue over whether the main problem with school financing is lack of sufficient state funding or the inability of school districts to rein in spending, consensus seems to be coalescing around the fact that the state’s share of school funding has declined over the years resulting in a need for more state funding to be directed to schools.
While it is beyond the scope of this article to analyze school finance, perhaps some information on school district property taxes might shed some light on the issue.
The above map shows the total of 2017 school district property taxes levied in each county divided by the Census Bureau’s 2017 population estimate of that county. This gives the per capita ISD property tax levy for each county — basically, the average school district levy per person in that county.
However, the map does not include data for Randall County. The property taxes for the various school districts in Randall County have been allocated to the surrounding counties elevating each of their per capita levies. (Technically, the data is reported by appraisal district, not by county. Since Randall County does not have its own appraisal district, it shares one with Potter County, the levy was split among those appraisal districts that share a school district with Randall.)
Elsewhere, if a school district extends into more than one county, its 2017 property tax levy was apportioned to the appropriate county prior to calculating the per capita levy.
Areas with the largest independent school district (ISD) levy on a per capita basis tend to be in the western part of the state. While these are some of our least populated counties, many of them are located in the Permian Basin.
In addition to calculating the per capita levy, one can also calculate the ISD levy per enrolled student. The Texas Education Agency (TEA) provides various reports on the number of students enrolled by county; the following analysis uses data from the 2016-17 school year.
Map 2 (above) appears fairly similar to the previous map with a large concentration of high values in the Permian Basin area of west Texas. But, don’t overlook the changes around the various metropolitan areas such as DFW and Houston. The use of different map brackets can partially explain these changes, but not entirely.
Another noticeable difference occurs in Loving County. The TEA report provides the number of children enrolled by grade but redacts the data when fewer than five children, but more than zero, are enrolled in an individual grade. TEA redacts the data in order to comply with the U.S. Family Educational Rights and Privacy Act of 1974. While this impacts certain other counties to a small degree, it greatly impacts Loving County which is consequently not included in the report. Since we cannot access enrollment numbers for Loving County, we cannot then calculate the per student levy.
If you want to avoid reading about how average ISD tax rates were calculated, skip ahead to the next paragraph. To create Map 3 (above), I took the total taxable value for maintenance and operations (M&O) for each school district and apportioned them by county as with the total levies — with the same Randall County issue previously discussed. With the total M&O taxable value and the total M&O levy, I then calculated an average ISD property tax rate for M&O for each county. That process was repeated for the interest and sinking (I&S) portion of each counties levy. The average total tax rate equals the sum of the M&O and I&S rates.
The final map shows these averages. This map varies considerably from the previous maps. In particular, the concentration of high-value counties seen in the Permian Basin has abated somewhat while the concentrations around some of the major metropolitan counties increased. Specifically, see the high average tax rates around DFW, Houston and Austin-San Antonio.
Look at the three maps in quick succession. Did you notice how the emphasis shifted from the Permian Basin area of west Texas to the major metropolitan areas of east Texas? That shift highlights why school finance is a hot topic in the state capitol. It is no longer sufficient for schools to raise their property tax rate. Even if they have the leeway to raise the rate, which many districts don’t, the first two maps show that equity no longer exists in school financing just as the third map indicates why raising rates may not be a viable option either. Rather than being a local problem that can be solved with local property tax dollars, school finance has become a statewide problem that needs a statewide solution.
Notes: At the end of each calendar year, the Texas Comptroller of Public Accounts collects data on prior year property taxes. This process takes a number of months since the data must be verified before it can be used in the statutorily required Property Value Study (PVS) which ensures appraisals are being made at market value; low appraisals result in increased state funding for schools while high appraisals anger voters. In early 2019 the Comptroller will begin collecting data on 2018 property taxes. Consequently, the most recent property tax data available covers the 2017 tax year.
After collecting and verifying the PVS data, the Comptroller releases the data on property tax levies and rates with each school district’s data further subdivided by the appraisal district.
The TEA report used in this analysis provides the number of students enrolled in Kindergarten through the 12th grade. Also, where these programs exist, the report provides the number of students enrolled in Early Education and Pre-kindergarten programs. *