School Finance Reform out of committee
By DS Gands
May 4, 2004
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Chairman Grusendorf anticipates the school finance legislation to be scheduled for floor consideration on Tuesday, May 4, 2004.


A bill and constitutional amendment from committee were passed on Saturday

and the proposed legislation went before the Calendars Committee for consideration on Monday, May 3.


In response to the bill, Gov. Rick Perry stated on Monday, "Legislators don't have to cast a vote to send jobs out of state.  They don't have to risk our economic fortunes and stop the migration of jobs and companies coming to Texas. I have offered them a plan that increases funding for education by $2.5 billion in new dollars, reduces property taxes initially by $3.2 billion, and protects not only the pocketbooks, but also the jobs, of the folks back home. We need a property tax cut that isn't financed on the backs of Texas workers, and at the expense of their jobs."


The documents available on April 30th outline the bills being considered on Saturday:


C.S.H.B. 1 Outline


C.S.H.J.R. 1


(For entire page click on Select Committee on Public School Finance)


A press release from the House news site stated:  State Rep. Juan Manuel Escobar today asked State Comptroller Carole Keeton Strayhorn to analyze the possible impact of a proposal for a new state "payroll tax" on the job climate in Texas.


The sales tax increase is from 6.25% to 6.75%, and the assessment proposals include billboards, mixed drink licenses, bottled water, newspaper inserts, magazine and newspaper subscriptions, and Internet access if the service is under $25 per month.  Cigarette tax is increased as well, but with the ever-growing number of former smokers, it may not yield as much as estimated.  A heavy tax burden is applied to smokeless tobacco, as well.


Another proposal was the reporting of the sales price of property to the appraisal districts, and though it has not been completely revealed, it was proposed that the property tax cap would only apply to the owner occupied residential properties.


Businesses are included in the taxation, with a 1.25% tax on each employee up to $500.


One member of the committee was not present to vote, and the vote was along party lines with the exception of Ron Wilson (D-Houston).  The final vote at 5pm Saturday, May 1st, was 21-7.


The members expect that the Bill and the Joint Resolution will be a heated debate on the floor, and the public is just now beginning to learn the particulars of this sweeping change.  Local governments are also likely to voice strong opposition to the changes.


Debate on the legislation begins Monday, as these documents are presented to Calendars to be heard on the floor of the House Tuesday, May 4th.   It is a trade-off on property taxes with the burden still coming out of the same pocket.