Honorable Larry Taylor, Chair, Senate Committee on Education
FROM:
Ursula Parks, Director, Legislative Budget Board
IN RE:
HB21 by Huberty (Relating to the public school finance system.), Committee Report 2nd House, Substituted
The bill would gradually increase the small district multiplier applicable to school districts having fewer than 1,600 students and encompassing less than 300 square miles until the multiplier is equal to that provided for school districts with fewer than 1,600 students that encompass 300 or more square miles. More than 50% of the additional revenue produced through the increased adjustment would flow to districts in the two lowest quintiles of property wealth per weighted student beginning in FY19.
The bill would provide a program of hardship grant awards on a formula basis for fiscal years 2018 and 2019. The formula would provide aid for changes in the statutory structure of the FSP that occur after January 1, 2017 within the parameters of specific eligibility criteria. Under this language, the formula for grant awards would recognize effects related to the expiration of Additional State Aid for Tax Reduction (ASATR) and effects resulting from legislation enacted by the 85th Legislature affecting Chapters 41and 42 Education Code. Hardship grant awards would primarily flow to school districts in the two highest quintiles of wealth per WADA. Current estimates indicate 90% or more of hardship grant funding in each year would flow to districts in the two highest quintiles of wealth per WADA.
Beginning in FY19, the bill would increase the guarantee level for school district debt service equalized under the Existing Debt Allotment. The current guarantee level of $35.00 would be increased to the lesser of $40 or the guarantee level that would increase state aid by $60 million. The additional equalization would primarily benefit districts having lower property wealth per student.