Two important pieces of news came out of the House Appropriations Committee today. First, when they met this morning to consider HB 1025, regarding supplemental appropriations (spending for the current biennium), Chairman Jim Pitts (R-Waxahachie) announced that the bill was $598 million below the spending cap and that he intended for $500 million to be appropriated for public education in the current school year. It is unclear at this time how the $500 million for schools during the 2012-13 school year will be distributed. One option would be to distribute the money on a per-WADA basis, ensuring that every district receives some form of funding restoration.
Next, following the passage of Senate Bill 1 (the General Appropriations Act) in the Senate yesterday, the Committee considered SB 1 today and recommended their version to the full House. Before officially adopting their version of the bill, the Committee adopted a rider that would provide another $1 billion for public education. That means that the House version of the bill spends $2.5 billion more than the filed version of the bill (which only added enough funding to cover enrollment growth). As you know, the previous $1.5 billion already adopted by the House Committee did so in a manner that restored the Regular Program Adjustment Factor (RPAF) to 1 and then flowed the remainder through the Basic Allotment in a manner that reduced ASATR on schedule and ensured that no district experienced any funding reductions.
The additional $1 billion in spending for public education that was adopted today would increase the Basic Allotment to $4,890 in FY14 and $4,975 in FY15. This change is being touted as increasing equity in the system by bringing the bottom up. The House proposal will have a wide range of impact for districts. Some districts will now see a funding level that far exceeds where they were prior to the cuts applied last session, some formula districts will see a more modest increase, and then those districts still on target revenue and receiving ASATR funding will not see any additional increase over and above what was already provided through the restoration of the RPAF. All Chapter 41 districts will see a reduction in recapture due to the increase to the BA which then increases the Equalized Wealth Level. For ASATR districts, this reduction in recapture is offset by less state aid in ASATR funding.
There are more districts that will become formula districts due to this increase as well, and all ASATR districts will see much less of a reliance on ASATR (in large part due to the decline in recapture).
We will provide more details on this new proposal as they become available. The House is expected to take up the budget within the next two weeks.