Region One FAC Mtg 10-16-15 · 2019. 4. 1. · A presentation to Region One Financial Advisory Council by Lynn Moak Legislative Update ... • Rep. Patricia Harless (R‐Spring)

A presentation to Region One Financial Advisory CouncilbyLynn Moak

Legislative Update

•Supreme Court• Interim Committees & Studies•State Revenues• Issues Worth Thinking About

Topics

10/16/2015© Moak, Casey & Associates 2

• State’s Position• It’s a political question and not subject to judicial review

• Not ripe, send it back to trial court• Money doesn’t matter

• Intervenors• Charter schools are disadvantaged• State laws regulating public education make it inefficient

• Plaintiffs• State property tax (value growth accrues to state), inadequate, unsuitable, inequitable

• Money does matter• Increased standards should be restudied as to cost

Arguments


• Apparent disregard for the state’s “political question” argument

• Did not seem to lean toward declaring all regulations inefficient

• Seemed to be focused on outputs as opposed to inputs

• Concern for whether there was progress toward the state goals of college and career readiness

Court Reaction


Speculation on Date of Opinion


• Potential range from mid‐December to April• Personal guess: mid‐December

• Sen. Kevin Eltife / Chair of Business & Commerce & Select Committee on Government Facilities

• Sen. Troy Fraser / Chair of Natural Resources & Economic Development

Interim and Politics –Senate Turnover


• Rep. Jimmie Don Aycock (R‐Killeen) / Chair of Public Education

• Rep. John Otto (R‐ Dayton) / Chair of Appropriations• Rep. Sylvester Turner (D‐Houston) / Vice‐Chair of Appropriations

• Rep. Jim Keffer (R‐Eastland) / Chair of Natural Resources• Rep. Myra Crownover (R‐Lake Dallas) / Chair of Public Health

• Rep. Susan King (R‐Abilene) / Chair of Defense & Veteransʹ Affairs

• Rep. Ruth Jones McClendon (D‐San Antonio) / Chair of Rules & Resolutions

• Rep. Allen Fletcher (R‐Tomball)/ Chair of Select Committee on Emerging Issues in Law Enforcement

Interim and Politics –House Turnover


• Rep. Joe Farias (D‐San Antonio) / Vice –Chair of County Affairs

• Rep. Patricia Harless (R‐Spring)• Rep. Bryan Hughes (R‐Mineola)• Rep. Marisa Marquez (D‐El Paso) / Vice‐Chair of House Administration and Appropriations ‐ S/C on Budget Transparency & Reform

• Rep. David Simpson (R‐Longview)• Rep. Scott Turner (R‐Frisco)

Interim and Politics –House Turnover


• House and some Senate charges still being formulated

• Senate Education Committee• School choice

• Education savings account and tax credit scholarships• Charter schools

• Disposition of state property• Facilities funding

Interim Activities



• Senate Education Committee (con’t)• Teacher supply and demand

• Subject area shortages• Efficiency/productivity review

• Performance‐based funding• State mandates• Comprehensive performance review of all public schools

• Broadband access• Improve access for districts and students• Statewide plan for competitive free‐market environment

Interim Activities (con’t)


• Senate Education Committee (con’t)• Teacher/student relationships/student safety

• Inappropriate relationships• Prevention and penalties

• Harris & Dallas County Departments of Education• Efficiencies, RESC relationship

• School board policies for low‐performing schools• School board training



• Senate Education Committee (con’t)• HB 5 implementation on alignment of public school and higher education• Preparation of high school students for higher ed and the workforce

• Implementation of 60x30TX plan (statewide strategic plan for 60% college completion)

• Monitor implementation of major legislation from 2015• State intervention • Pre‐K• Teacher preparation programs• Video cameras• Counselors• Alternative assessments



• Higher Education Committee• Performance funding for higher education• Tuition deregulation and student debt• Financial aid• Baccalaureate degrees at community colleges

• Senate Criminal Justice Committee• Monitor implementation of 2015 legislation on school truancy

• Police safety and community engagement• Re‐entry of incarcerated persons

• Veteran Affairs & Military Installations ‐ Sub‐Committee Border Security• Sanctuary cities



• State Affairs Committee• Religious liberty

• Role of “sincerely held religious beliefs”• Union dues

• Use of public funds for payment processing• Eminent domain

• Compensation of property owners• Ethics

• Comprehensive review of current and needed ethic laws• Monitoring

• Proposed reforms to the TRS



• Health and Human Services Committee• Child abuse and neglect• Foster care• Adoptions • Refugee resettlement program

• Natural Resources & Economic Development• Economic development programs

• Comprehensive review

• Intergovernmental Relations Committee• Debt transparency in the voting booth

• Information “provided to individuals in the voting booth”


• TRS Care• Assessment & Accountability Changes• Finance system re: Court Decision

• House Bill 1759 will be foundation for House consideration inclusive of potential elimination of the cost‐of‐education index

• Appraisal system (City of Austin suit)?

Topics for Interim Study



Biennial Revenue Estimate

Certification Revenue Estimate Change

Sales Tax Revenue $61.247 $59.690 ($1.56)Motor Vehicle Tax $10.033 $9.774 ($0.26)Natural Gas Tax $3.232 $1.915 ($1.32)Oil Production Tax $5.689 $3.907 ($1.78)Transfer to Highways $2.413 $1.729 ($0.68)GR Ending Balance $6.4 $4.2 ($2.20)“Rainy Day” Balance $11.1 $10.4 ($0.70)

Change in Revenue Forecast

Amounts in $ billions

‐4.00%‐2.00%0.00%2.00%4.00%6.00%8.00%10.00%12.00%14.00%

Percentage Revenue Growth

Sales Tax Revenue Growth in 2015

January February March April May June July August September

Recent Sales Tax Growth


2015 2016 2017BRE Revenue Projection

$28.901 $29.621 $31.505

BRE Growth Rates 2.49% 6.36%

Revenue @ 2% per Year $29.479 $30.069“Shortfall” ($0.142) ($1.436)

Revenue at ‐2%/‐4% $28.323 $27.190“Shortfall” ($1.298) ($4.315)

Sales Tax Slowdown

$ amounts in billions



$0.00

$10.00

$20.00

$30.00

$40.00

$50.00

$60.00

$70.00

$80.00

$90.00

$100.00

Price of Oil per Barrel ‐ Last 13 Months

$64.52

$69.27

Oil Slipping

WTI on Monday of first full week of the month

Price in 2016 $64.52 $40 $20

GR Revenue $1.084 $0.824 $0.611

ESF (Rainy Day) Deposit

$0.828 $0.437 $0.119

Oil’s Impact on State Finances

Price in 2017 $69.27 $40 $20

GR Revenue $1.135 $0.824 $0.627

ESF (Rainy Day) Revenue

$0.905 $0.438 $0.143


• Diverts potentially $2.5 Billion per year of Sales Tax revenue to highway funding• Diverts any excess above $28 billion, up to $2.5 billion

• Begins in 2018 fiscal year

• Diverts 35% of excess Motor Vehicle Sales Tax revenue to highways• Diverts portion of any excess above $5 billion per year

• Begins in 2020

SJR 5 (Highway Funding)


• Available Funds• Funding Base (HB 1759?) • Cost‐of‐Education Index • Accelerated Education

• STAAR improvement

• Bilingual/ESL Education• Performance Linkage?

Potential Elements of a New School Finance System



• Adopted by Coalition to Invest in Texas Schools (11 organizations, including STAS)

• Basic statements on: equity, capacity, meaningful discretion, and local control

2008 School Finance Core Principles


• MCA under contract with STAS will provide rationale and impact of modified formulas

• Assistance needed in description of current programs financed by comp ed and bilingual ed weights and a rationale for higher funding levels

2015 STAS Comp Ed, Bilingual Ed, and CEI


• TEA FAQ document• Options for district action

• Use 2015‐16 to plan for possible use in 2016‐17 or 2017‐18

• Reporting will be a problem for 2015‐16

HB 2610 (75,600 minutes of instruction rather than 180 days)

Curtis Culwell, Ed. D.Terry FaucheuxRebecca FloresChris GrammerKathy MathiasBob PopinskiLarry ThromMaria Whitsett, Ph. D.Joe WisnoskiAssociates

Lynn M. Moak

Daniel T. CaseyPartners

Thomas V. Alvis, Ph. D.Larry Groppel, Ed. D.

Mary McKeown‐Moak, Ph. D.

Alicia Thomas, Ph. D.Consultants

Susan MoakKari Ruehman

Administrative Staff

400 West 15th Street, Suite 1410, Austin, Texas 78701‐1648Ph. (512) 485‐7878 Fax (512) 485‐7888

www.moakcasey.com


Documents

Region One FAC Mtg 10-16-15 · 2019. 4. 1. · A presentation to Region One Financial Advisory Council by Lynn Moak Legislative Update ... • Rep. Patricia Harless (R‐Spring)