History of Public Education Sector in Texas
The public education sector in Texas started in 1840 when the first English-American public school of law was set up in Texas, which was later distributed into four leagues in an area covering 17712 acres of land in each of the four counties in Texas. To support public education, the state constitution of 1845 set aside a tenth of the annual taxes of the State. These revenues made sure that perpetual funds were going to schools across Texas. Later in 1845, a new school law was passed, which set aside $2 million of the total US Indemnity bonds that were received as part of the settlement of the Texas boundary claims against the US then. This was 5% of the total $10 million of the US Indemnity bonds. In 1876, the state constitution allocated over 45 million acres of land for public schools and ensured a Permanent School Fund obtained from the bonds to support the school system. This law worked well till 1884, when the school law on funding was rewritten. The new law saw the state superintendent’s office was reformed, and a new tax regime to support the public school system was recreated. The changes ensured that the Permanent School Fund was invested in the county, and other bonds to safeguard the income was increased substantially. State constitutional amendment on Permanent School Fund was achieved in 1983. This new amendment provided guarantees which ensured that there were school bonds from Permanent School Fund at the district level.
The State has carried out series of amendments, and in the last decade, the equity spending at the school districts level has been in place. Currently, school districts in Texas get their funding through local property taxes and state funding. To achieve near equitable funding of all district schools in the State, communities have to use their revenue from local property taxes and request the State for the balance that the property tax cannot cover. Current data shows that the local property owners pay taxes which fund about 65% of the total funds needed to run the schools in the district. The problem with property taxes is that the economic factors play a role in determining how much the communities collect taxes. The uncertainty of property taxes has seen a series of lawsuits against the State to ensure they provide half the cost of public education in Texas. Texas district school funding is imperfect as it operates, so that wealthy school’s suburbs that receive more property tax tend to fund those in more impoverished areas. The reliance on property tax instead of the state income tax. The volatility of property tax revenues makes them unreliable for attaining equitable funding of schools. Many of the schools in local districts will face a lot of deficits during house busts as property tax plummets.
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