HARVEY DAMAGE COULD COST LOCAL SCHOOL DISTRICTS MORE THAN A BILLION DOLLARS
(AUSTIN) — Lost property value could mean up to $1.4 billion less for school districts in the areas affected by Hurricane Harvey last year. The Senate Finance Committee held a hearing Tuesday to continue oversight over spending and costs related to the disaster. According to testimony from the Legislative Budget Board, the state has already spend $2.6 billion on Harvey-related disaster recovery, most of which is federal funds. This doesn't include, however, costs to public education.
Public education in Texas is funded largely with local property taxes, so when property values in a district decrease, so does the money available for public schools there. Harvey, the worst storm to ever hit Texas, caused tens of billions in property damage with a commensurate loss in taxable property value. This could leave affected districts severely underfunded without some sort of relief.
The state is already statutorily required to spend $426 million to help schools with Harvey recovery. This includes directing more formula funding to affected students and to cover $150 million in lost property tax revenue in 12 districts who reappraised their property base following the storm. It also would set aside $99 million to help districts who lost student population. The Texas Education Agency has identified between $826 million and $1.4 billion in potential lost local property tax revenue. It would be up to the discretion of the next Legislature whether to cover these costs, and at what level.
Some members argued in favor of tapping the state's Economic Stabilization Fund, more commonly known as the Rainy Day Fund. The fund's balance amounted to about $10 billion at the end of fiscal year 2017. Friendswood Senator Larry Taylor, who represents parts of Brazoria, Galveston and Harris Counties, is in favor of using a one-time appropriation from the fund to cover the local property tax revenue shortfall. "Frankly, I would consider this what the Economic Stabilization Fund is for," he said. "We need to help these people get back on their feet. One out of five Texas students was affected by this storm." Committee Chair and Flower Mound Senator Jane Nelson agreed. "This is exactly why we have the Rainy Day fund," said Nelson.