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Austin ISD analyzing school finance bill as budget vote nears

Austin ISD leaders plan to release the district's budget next Friday but admit they are still working to understand changes brought on by House Bill 3.

AUSTIN, Texas — School may be out but Austin ISD leaders are hard at work on the district's budget. 

They plan to release it next Friday, June 14, and the board is expected to approve it that following Monday, June 17. But district staff and members of the board admit there are still some unknowns as they work through the changes lawmakers made to the school finance system through House Bill 3 (HB3).

HB3 injects more than $11.5 billion into the public school finance system. 

Here's a refresher on the school finance reform bill: Lawmakers say, overall, the state is increasing its share of public education funding from 38% to 45%. The basic allotment, or amount of money districts get from the state per student, is increasing by more than $1,000 to $6,160 per student. Districts will also get more money to educate students with dyslexia and those who speak English as a second language. Plus, the state is funding full-day Pre-K for low-income students and there's money for raises for teachers, librarians, counselors and nurses.


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But district staff said there are other parts of the 308-page bill that aren't so clear. For instance, AISD leaders said it's up to them to figure out how they will distribute those teacher raises. And, for the first time, AISD will have to pay into the Teacher Retirement System. Currently, the district just pays into social security, but HB3 will require them to do both.  

The district's recapture payment – which is how much AISD has to send the state to help educate kids in property-poor districts – will decrease. But district leaders told KVUE they won't save as much money as they could because lawmakers changed the home value used to calculate funding from the prior year value to the current year value, which is a higher amount. 

HB3 reduces recapture payments by nearly 50%. Prior to voting on the bill, Texas lawmakers were given spreadsheets with estimates of how much the districts in their area would save in recapture payments. 

The estimated changes for districts in our area are:

Austin ISD

Current law recapture payment: $781,645,840

Fiscal year 2020 HB3 recapture payment: $588,289,485 

Round Rock ISD

Current law recapture payment: $51,612,437

Fiscal year 2020 HB3 recapture payment: $0

Georgetown ISD

Current law recapture payment: $25,345,595 

Fiscal year 2020 HB3 recapture payment: $3,512,610 

Lake Travis ISD

Current law recapture payment: $58,266,677

Fiscal year 2020 HB3 recapture payment: $35,712,810 

Eanes ISD

Current law recapture payment: $110,681,019

Fiscal year 2020 HB3 recapture payment: $96,095,343 

It's worth noting that Austin ISD pays the most money to the state in recapture, with Houston ISD coming in second place. The HB3 projections show Houston ISD's recapture payment would be reduced to nothing for the fiscal year 2020.

HB3 also includes more than $5 billion in property tax relief for homeowners. The state used the money to buy down the school district's M&O (maintenance and operation) tax rate by about eight cents per $100 in home valuation in 2020. For a home valued at $300,000, that's an annual savings of about $240.

District leaders also point out Governor Greg Abbott hasn't signed HB3 into law yet, though he has publicly voiced his support of the bill. Even if the governor doesn't sign the bill, as long as he doesn't veto it, it will go into effect.

The last day for Gov. Abbott to sign or veto bills is Sunday, June 16. 

Click here to view the HB3 Fiscal Year 2020 impacts by House Member.

Click here to view the HB3 Fiscal Year 2021 impacts by House Member.

WATCH: A look at how the state school funding bill will impact Austin ISD


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