The State of Texas began the presentation of its defense on Thursday, December 6, and continued through December 13, when the Court recessed for a three week holiday and did not resume until January 7.  On January 14, the State concluded their presentation, but did not rest their case, as they have one additional expert witness to call at a time that coincides with the presentation of the Charter School Intervener’s case.

Dr. Grover Whitehurst of the Brookings Institute was the State’s first witness.  Dr. Whitehurst used NAEP scores, graduation rates, and AP course participation rates to compare performance between states.  His analysis showed Texas was ranked 4th of all of the states.  He also pointed out that when data is disaggregated by student group, Texas performs very well compared to other states.  Dr. Whitehurst offered criticism of both the cost function approach and the evidence based approach used to determine the cost of providing an adequate education.  He also disparaged the Tennessee STAR class size study.

Dr. Gloria Zyskowski, Student Assessment Director at TEA, explained the difference between TAKS and STAAR, which she described as a more rigorous assessment with a greater emphasis on college and career readiness.  Dr. Zyskowski also described the history of improvement on state assessments, and the standard setting process.  Dr. Zyskowski went on to testify that TEA’s recommendation for the definition of college readiness is that it be linked to the STAAR Level II standard, rather than Level III (though not yet adopted by the Commissioner of Education or the Commissioner of Higher Education).  David Thompson, representing the Fort Bend ISD plaintiffs, questioned whether the Level II standard represented college readiness, and pointed to deposition testimony and public presentations which identified Level III as college ready. 

Pearson’s Vice President of Measurement Services, Dr. Laurie Laughlin Davis, also confirmed that STAAR is a more rigorous assessment than TAKS.  She explained the life cycle assessments and explained the studies performed to establish external validity of the assessment relative to ACT and SAT, grades in college and high school courses, and the TAKS test.  Dr. Davis also testified about the impact student motivation has on assessment results.

TEA Associate Commissioner for Standards and Programs Anita Givens provided a detailed overview of the curriculum development and implementation process, from TEA and SBOE all the way into the classroom, and she also described graduation requirement programs and the Instructional Materials Allotment.  Additionally, Ms. Givens described the professional development available through TEA, including Project Share, and she spoke to the Virtual School Network available for students. 

The State then called Dr. Michael Podgursky, who serves as a professor of economics at the University of Missouri.  The main premise of Dr. Podgursky’s testimony is that he does not believe that you can use a formula to determine the cost of certain levels of student achievement.  He testified that there was no evidence that the amount of student spending has any impact on test scores.  Dr. Podgursky also testified that the variance of test scores primarily exists between students within the same district, rather than a variance between districts. 

On behalf of the Fort Bend plaintiffs, Phillip Fraissinet pointed to analysis Dr. Podgursky performed in other states, which ranked Texas near the bottom for student spending.  He also noted flaws in Podgursky’s methodology which could have led to double counting some students. 

Micah Skidmore, on behalf of the Calhoun County ISD plaintiffs, pointed out that while Dr. Podgursky made the point that Texas teacher salaries are lower due to the having lower student to teacher ratios, when ratios increased due to budget cuts, average teacher salaries declined.  Dr. Podgursky was puzzled why teachers would be paid less when teaching more students.

Dr. Shannon Housson, TEA’s Director of Performance Reporting, explained the elements of the accountability system currently under consideration.  Those elements included student performance, student progress, closure of performance gaps, and post-secondary readiness.  Prompted by Lacy Lawrence, on behalf of the Calhoun County ISD plaintiffs, Mr. Housson testified that 9th grade students were already being held accountable, even though schools were not.  Ms. Lawrence pointed out that approximately half of 9th grade students assessed by STAAR last year are not on track to graduate and 70 percent—the highest number ever—failed to meet Adequate Yearly Progress.

Rob Coleman, Assistant Director of Fiscal Management for the Texas Comptroller, began his testimony with an overview of the Texas budget process, including the Comptroller’s role in that process, and the Rainy Day Fund (RDF).  Mr. Coleman also testified that the margins tax has underperformed by $3.8 billion below the estimated $6.8 billion that it was expected to generate when the legislation was passed.  The Foundation School Program has been funded with General Revenue to make up the difference in the shortfall.  Mr. Coleman offered testimony regarding the increased levels of state funding appropriated to public education since 2004. 

Lacy Lawrence, on behalf of the Calhoun County ISD plaintiffs, had Mr. Coleman acknowledge that the increase in state funding for education was largely due to the tax trade-off when schools were required to reduce local property taxes, which did not result in an increase in overall revenue for schools.  Ms. Lawrence demonstrated that the RDF was expected to have a balance of over $11 billion by the end of the biennium a much higher balance than has previously been maintained.  Rick Gray, representing the Texas Taxpayers and Student Fairness Coalition, brought forth information on the Biennial Revenue Estimate and compared the $8.8 billion surplus to the $5.4 billion in cuts made to schools last session. 

Shirley Beaulieu, Chief Financial Officer of the Texas Education Agency explained the appropriations made for public education.  Ms. Beaulieu testified that the reduction in the funding was due to the elimination of federal funds, not state cuts.  She also pointed out that formula funding, which benefits all districts, has increased in the current school year.  Only the discretionary funding (ASATR, SSI, and Pre-K) had been reduced.  

Michelle Jacobs, representing the Calhoun County ISD plaintiffs, pointed out that Ms. Beaulieu’s numbers were not based on what schools would have received under old formulas, had they not been changed.  In fact, when Ms. Beaulieu’s numbers were adjusted for enrollment growth and inflation, they showed that per student spending was well below 2007 levels. 

Dr. Lisa Dawn-Fisher, Associate Commissioner for School Finance at TEA, described the cuts that were applied during the last legislative session, including the manner in which cuts were applied that caused gap between districts to narrow in 2012-13, creating more equity in the system.  Dr. Dawn-Fisher explained that ASATR is on the decline, and she reviewed the data that shows 657 districts are currently on formula, while only 392 remain on target revenue.  ASATR comprised 6% of total funding in FY2012 and only 3% of total funding in FY2013. 

Dr. Dawn-Fisher reviewed the implications of using a simple average (such as those used by Dr. Wayne Pierce) and a weighted average (like that used by Dr. Kal Kallison).  A simple average is not representative of the school finance system as a whole.

Judge Dietz asked if any analysis existed regarding the cost of providing the basic program. Dr. Dawn-Fisher did not know of one.  When the Judge asked who would know best what it costs to educate students, Dr. Dawn-Fisher said local school districts would know best.  The Judge also questioned whether the cost of a basic education could cost above $1.04 in some districts, stating that our system potentially gives local voters the ability to deny local schools and students the basic program of education that the State is constitutionally obligated to provide. 

Rick Gray, on behalf of the Texas Taxpayers and Student Fairness Coalition, pointed out some errors in Dr. Dawn-Fisher’s data associated with double counting the recapture payments for a number of Chapter 41 districts that off-set their recapture payment against hold-harmless funding from the State.  Judge Dietz said that in order for the Supreme Court to have the most accurate data possible, he was ordering the State to submit a corrected data file for this report. 

Tom Currah, Senior Advisor and Data Analysis Director for the Texas Comptroller testified regarding the FAST study that integrates academic and financial data for the purpose of school district comparisons and rankings.  Mr. Currah explained the methodology used for FAST and presented data that represented that total expenditures for education had grown at a rate faster than inflation and enrollment growth over the past decade. 

David Thompson, on behalf of the Fort Bend ISD plaintiffs, pointed to many of the concerns regarding FAST that were expressed by school districts.  Micah Skidmore, on behalf of the Calhoun County ISD group, asked whether the FAST analysis says anything about a causal relationship between spending and performance, and Mr. Currah conceded that it does not.

Director of Early Childhood Education, Gina Day, testified regarding pre-kindergarten.  Ms. Day reviewed the requirements for pre-K in Texas and said that based on census data, Texas serves 20 percent of the total population of 3-4 year-olds and 90 percent of the eligible population.  Ms. Day reviewed all of the grant programs the state offers for pre-K programs.

The final witness to testify was Susie Coultress, TEA’s Director of Bilingual, ESL, Title III, and Migrant Programs, who testified regarding the agency’s responsibility for providing programs for English Language Learners (ELL). Coultress described the differences between bilingual education and ESL and explained the four different delivery models available for ELL students (early exit, late exit traditional bilingual and one way, two way dual language).

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