The Board of Trustees for the White Oak Independent School District approved a resolution to join the Equity Center in litigation requiring the state of Texas to fundamentally change the way Texas Public Schools are funded. It is unfortunate, but the Texas Legislature historically is reluctant to change without litigation. The purpose of this legal action is to create a fair/equitable/adequate system of public school finance.
Let me try to give you a quick history of how we arrived at a place where this lawsuit is necessary.
• 2005 – Legislators make the decision to compress the property tax rate by 33%. The maximum tax rate becomes $1.00 per $100.00 value and districts can add 4 pennies to that amount. The state plans to make up the difference (33% loss) with a margins tax on businesses in Texas. That choice leads to a structural deficit of 10 billion dollars over the next 6 years and sets the stage for the shortfall that was addressed in the 82nd Legislature.
• With a full understanding that the margins tax was not going to fund schools as required by the Texas State Constitution, lawmakers came up with the plan to create Hold Harmless/Target Revenue funding values for all but the lowest funded schools in the state. These values were assigned to districts according to 2005/2006 values and have not changed in six years. Districts do not benefit from increases in property values or new businesses that move into the district. Under target revenue, new money that increases local school revenue, decreases state revenue in equal portions. Commonly referred to as “zip code values”, schools have been funded on a per student value that ranges from less than $4,000 per student to over $12,000 per student. The value of a student varies in such random manner that the children in adjoining districts are funded at values more than a $1,000 apart.
• With this information in mind, the 82nd Legislature met and decided the best way to deal with the self-inflected 10 billion dollar structural deficit would be to cut everyone equally. The term that was used was “share the pain”. There was no acknowledgement that the low target revenue schools had been “sharing the pain” since 2005/2006 and high funded districts had yet to experience any discomfort! The Target Revenue system that is blatantly in-equitable is scheduled to be discussed by the legislative body in 2017, three legislative sessions down the road.
• The 82nd Legislature developed a budget that did not meet the Constitutional requirements to fund Texas Public Schools. The budget was 4 billion dollars short of the states obligation. At the same time, there was 9 billion dollars in the Economic Stabilization Fund (Rainy Day Fund) that could have been used to bridge the gap. Instead of using available funds, the legislature voted to amend/suspend the constitution and give them the freedom to approve a budget that otherwise would have been in violation of Texas law.

With that information in mind, let me give you the information that is applicable to White Oak ISD.
• WOISD is in the bottom 18% of Target Revenue School Districts in the state. If we had been assign a value equal to the average district’s target revenue, we would receive an extra $250,000 in state and local funds.
• WOISD has a yield per penny of tax at $49. This is on the low end of the scale and includes the extra revenue provided from the 13 cents voters approved by the Tax Rate Election in 2007. Local tax payers add $637.00 of funding per student in WOISD. The budget cuts of 2011 decreased our local contribution by over $70,000. These were locally approved funds and state lawmakers decided to reduce that loss by issuing a one time payment of $30,000. Over two years, that is $110,000 short!
• White Oak ISD is one of more than 250 school districts that operate at a $1.17 tax rate for maintenance and operations. The vast majority of the districts that have voted to approve the TRE are low target revenue schools. Districts with high target revenue can generate more funds with a lower tax rate.
• White Oak ISD does not have a large bonded debt for new construction. The last construction project in WOISD was 1999. The last instructional facility built in White Oak was completed in the mid 1980’s. The district has not been wasteful of the tax payer’s money.

There are six East Texas school districts that rank in the top 25% of Target Revenue Funding. What would it mean to White Oak ISD to be funded at the level fo one of those schools:

District Increase in T.R. Increase in Revenue
Tenaha ISD $892 $1,516,400
Yantis ISD $1,025 $1,742,500
Hallsville ISD $1,199 $2,038,300
Arp ISD $1,398 $2,376,600
Carthage ISD $2,009 $3,415,300
Beckville ISD $2,069 $3,517,300

Two points need to be made about this data. First, I do not believe any of these districts are overfunded by the state. They are using the funds made available to them to meet the needs of their students. Second, these districts do not get to keep all of the funds generated in their local communities. They are Chapter 41 Districts and send money to the state in the form of “recapture” or Robin Hood payments. The system is broken top to bottom and there has been little to no interest in addressing the problem by the state legislature. In the process of creating a new equitable funding system, some districts will see a decrease in funding. The greater goal is to see all students in the state funded at a level that will ensure their opportunity to experience success. Texas is currently the 2nd wealthiest state in the Union (Gross Domestic Product, US Census) and ranks between 37th and 44th in funding per student in Public Education. (politicalfact.com) The 4 billion dollars in cuts approved for the current budget could move the state to 49th in per student spending.
The leadership of the White Oak Independent School District corporately believes it is time to call for a change in this system. It is not something that can wait until 2017, or longer. The board has approved joining and financially supporting the Texas Taxpayer and Student Fairness Coalition. For a one time fee of $1,700.00 (one dollar per weighted average daily attendance) this coalition will petition the state to develop a new funding system that fairly compensates all school districts in a way that allows for the provision of a world class education for all students. This will include fairness for the taxpayer who wants to see his/her dollars put to work in an equitable manner. The key points to the litigation and more detailed financial information can be found on the Equity Center Website, http://www.equitycenter.org/. White Oak ISD has also posted the Equity Center Power Point Presentation on the district’s website (www.woisd.net) I will be happy to visit with anyone individually or in groups that would like more information about the lawsuit and/or White Oak ISD’s participation in the process.