The Gilmer-Aikin Act, adopted by the Texas Legislature in 1949, established a public school finance system that, for the first time, included funding from local tax bases. This revenue was to be used for local enrichment. More than 65 years ago, local control was recognized as the key for local districts to flourish. The same remains true today.
The current school finance system, however, is making it extremely difficult for local communities to devote any extra resources to the educational needs of children in their local school district.
Despite rising property values, the amount of locally generated tax revenue Chapter 41 School Districts are allowed to retain is fixed even though costs are increasing. Chapter 41 Districts have no choice but to reduce the quality of education they offer. Also, Chapter 41 Schools that are not at the maximum tax rate are reluctant to raise taxes knowing a large percentage of that increased local money (in some cases 50 percent or more) must be sent to the state.
Without fiscal discretion, there is no local control.
Since the Texas Legislature reduced property taxes by one-third in 2006 (from $1.50 to $1.00) there has been a school finance revenue deficit each year.
Districts must have meaningful discretion to make decisions that reflect the values of their local community. Local discretion is lost, however, when Chapter 41 School District payments to the state reach 50 percent or more.
Convincing parents and taxpayers in ‘Robin Hood’ school districts that it is in their best interest to send 50 percent or more of the tax revenue to state is not a hard sell – it is an impossible sell. And the ultimate consequence is that all schoolchildren suffer.