Friday, April 8, 2011

House Considers Accounting Maneuver To Slightly Ease School Funding Crisis

The Texas Democratic Party released new video details on HB 1, the state budget bill passed by the Texas House on Sunday.

HB 1 codifies a draconian $164.5 billion 2011-13 budget that cuts $23 billion from 2009-13 spending levels. HB 1 slashes public school spending by nearly $8 billion and cuts Medicaid spending by more than $4 billion.

The deficit was created when 2006 legislative session lawmakers cut state revenue by giving deep business tax cuts.

Upon passage of the HB 1 Rep. Joaquin Castro, D-San Antonio released a statement that says in part, "Eighty thousand kids are not going to get their scholarships and grant money because of this bill. Forty-three thousand people are going to get kicked out of nursing homes or denied nursing home entrance because of this bill..."

Lawmakers in the Texas Senate have been working on their own version of the budget, but the Senate version cuts only $13 billion from current spending levels to mitigate the cuts to public education and Medicaid. Senate budget-writers propose adding $10 billion state-related revenue through new and increased fees.

Thursday morning State Rep. Rob Orr, R-Burleson, introduced two bills to the House Appropriations Committee that could add several million dollars to the public schools budget over the next two years. These bills providing for some accounting maneuvers to more easily shift money around a couple of state agencies responsible for public school funding:

HB 2646 proposes allowing the School Land Board to transfer at least half of the net revenue it collects from a land trust it oversees to the Available School Fund (ASF), an endowment that puts money directly into public schools in Texas. Orr said that pot of money has risen to more than $2.5 billion in market value and contains more than $1 billion in cash. If that trend continues, the fund could supply the state with an additional $500 million in the next biennium.

HB 2646 requires companion legislation (HJR 109) to put a constitutional amendment on the November 8, 2011 ballot that would allow the General Land Office to distribute revenue directly to the ASF.

The School Land Board (SLB) was established in 1939 by the 46th Legislature to manage the sale and leasing of public lands that fund the Permanent School Fund. The Permanent School Fund (PSF) was established in the state Constitution of 1876, the current charter of Texas law, to fund public eduction using revenues generated from Texas' land and mineral resources. The SLB’s responsibilities include approving land sales, trades and exchanges, and the purchase of land for the PSF. In addition to this, the SLB issues permits, leases and easements for uses of state-owned submerged land. The SLB is just one of nine boards and councils chaired by the Commissioner of the General Land Office. As chairman of nine boards or councils, the Land Commissioner oversees matters that range from state lands and coastal issues to veterans affairs.

The General Land Office of Texas (GLO) manages state lands and mineral right properties, including oil and gas production leases on more than 20 million acres of state land. State lands and mineral right properties include the beaches, bays, estuaries and other submerged lands out to 10.3 miles in the Gulf of Mexico, institutional acreage, grazing lands in West Texas and timber lands in East Texas. Revenue and royalties are distributed to school districts on a per-pupil basis, helping to offset local school property taxes.

The Available School Fund is made up of the money set aside by the state from current or annual revenues for the support of the public school system. There are two major revenue sources for the fund: earnings from the Permanent School Fund managed by the School Land Board and 25 percent of fuel tax receipts. The fund does not receive annual appropriations by the legislature from other general state revenue sources.

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