By: Dennis Spellman
KATY (Covering Katy News) – Democratic lieutenant governor candidate Mike Collier was in Katy last week and had a dire warning — saying the state is going broke, is confiscating property taxes in an effort to cover up that Texas is deeply in debt, and that, in his words, “the day of reckoning is coming.”
Collier, a former senior partner at PricewaterhouseCoopers and oil company executive is using his 30 years of financial and business experience to make a very complicated case in plain English.
“The state is running out of money,” Collier said. “The idea that Texas always balances the budget is pure lies. We’ve been borrowing billions to make ends meet.”
The money is coming from property taxes that most people believe is being utilized to pay for local school districts, but over the past several years, billions have gone to Austin and have never returned to any school district.
The funding gap is causing major frustrations at the Katy Independent School District. At a time of growing enrolment, the state has reduced funding to Katy ISD by $100 million over the past four years, Chief Financial Officer Chris Smith told Covering Katy News. Over the past 10 school years, Katy ISD has seen about a 38 percent growth in enrollment. Next year it will grow to 41 percent, and the district expects less money from the state.
It’s a “funding cliff,” Smith told the school board earlier this year.
In the 2013-14 school year funding from the state paid for nearly half of the Katy ISD general fund school budget. By 2016-17 the state’s contribution was down to 36 percent, and it will continue to drop under the current formula. By 2021 Smith projects that the state’s contribution will fall to 29 percent of Katy ISD’s total general fund budget.
The state’s share of school funding has been decreasing while homeowner and small business owner property taxes continue to rise, and Collier said that pattern cannot continue.
“There’s a loophole that allows owners of large industrial and corporate properties to underpay their taxes to the tune of $5 billion per year. But don’t trust me, take a look at the reports going back to the Rick Perry administration. It’s a problem that has been known for more than a decade. Yet no one in Austin does anything about it,” Collier said.
The loophole Collier was referring to is known as “Equal and Uniform,” and it was originally designed to allow homeowners to protest their property valuations by comparing similar properties.
“What’s happened is these large commercial properties have used teams of lawyers which aren’t available to the majority of Texans to negotiate down their values — values that almost no one would think are accurate. And all the tax benefit goes to corporate shareholders, most of whom don’t live in Texas,” Collier said.
“For those that say closing that loophole would amount to a job-killing tax increase, I say no. It’s just following the law. These companies should be paying their fair share, because if they don’t then it falls on the backs of you and me. We cannot keep being expected to pay the state’s bills,” he added.
Other subjects discussed included several that Collier opposes, like high stakes testing, vouchers for private school tuition, and arming teachers. When the questions shifted to promises of raises for teachers, Collier said, if elected, he would give teachers raises. However, he believes the plan being pushed by current leaders would only make things worse.
“The plan my opponent (Lt. Gov. Dan Patrick) is pushing would in effect be just another unfunded mandate from the state. The state is already underfunding schools, so without an influx of state money, how would local districts afford to increase teacher pay?” Collier asked.
If school districts are mandated to increase teachers’ salaries in a time when fewer dollars are coming from the state, some have wondered if districts would have to lay off teachers to afford to give the remaining teachers pay raises.
At Katy ISD, the general fund budget has grown by about 60 percent, primarily because salaries have gone up across the board, according to Smith. Mandating a salary increase would be difficult for Katy ISD to juggle. Teacher salaries, classroom expenses, library costs, curriculum and staff development account for 67 percent of the budget per student, according to Smith.
“Dan Patrick knows he’s in trouble. That’s why he’s not here and why you hardly see much of him these days. He cannot defend his record one bit. Now he’s saying he’s a champion of teachers and promising a raise he can’t pay for. That’s hooey. Don’t believe his lies,” Collier said.
Lt. Gov. Dan Patrick was not at the candidate’s forum held by the Katy Area Retired Educators but Collier was there.
On the subject of retired teacher benefits, a cause that was clearly very important to everyone in attendance, Collier lamented the cuts from the last legislative session. He called the situation a “raw deal” and promised to restore funding to retired educator health care plans.
“When Texans make a deal, we live by our word. What’s happened recently — forcing retired teachers to make a month’s worth of medicine last a quarter of a year — is not Texan. We treat people better in this state,” Collier said.