On Tuesday, Texas legislators started their fourth session in three years, tackling the state's troubled school finance system. NewsChannel 11 set out to find what's keeping legislators from reaching a compromise. We discussed the issue with Lubbock Independent School District's Assistant Superintendent of Finance, Art Martin. He says someone has to pay for reform and what's holding the legislature up is figuring out who.
Martin explains, "It's not just inflation, it's not just students coming into the system every year, it's all of it combined with an antiquated system of taxation that somehow has to be dealt with." Martin says the state relies too heavily on property taxes to fund school finance and, until that changes, the legislature will have a hard time fixing a failing system. Matin says, "It's not an equitable system of taxation and how do you do that? 43 states out of the union have income tax. It's a much fairer system of taxation but not politically acceptable yet in Texas."
Short of an income tax, Martin says there are other options. Lawmakers could raise sales taxes, get rid of a loophole that allows companies to incorporate out of state so they don't have to pay Texas' franchise tax, or start taxing sole proprietors like doctors and lawyers. He explains, "If you're someone who owns an apartment building or you own a business that requires you to own a lot of property taxable under the tax code, whether it made money or didn't, you still have a tax bill at the end of year. If you're a doctor or lawyer or stockbroker, if you're a consultant or sole proprietor and can make money without owning a lot of property, then you're getting to escape supporting public education."
Martin says legislators need to come up with a solution by the end of this special session, otherwise there won't be time to put something in place by the beginning of the school year. Lawmakers are facing another deadline too, that's July 6th when the state supreme court will hear arguments over the constitutionality of the current "Robin Hood" funding system.
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