BUSINESS NEWS YOU CAN USE
Business News can be found below the Bill Status Report

 Bill Status Report 

For a list of bills impacting school business filed for the 2009 session of the Texas Legislature <click here> .  The report will be updated often during the legislative session, so check back regularly.

Updated State Aid Template

                HB 3646 version on ESC 13 Website

It’s preliminary and speculative and it’s here now. 

Omar Garcia at ESC 13 has posted a State Aid template reflecting the provisions of House Bill 3646.

It’s speculative in that the bill hasn’t been signed by the governor and it’s preliminary as we don’t know how TEA will implement it.  There will almost certainly need to be some interpretation along the way.

Throw away all those old printouts and take charge of your own fate and make your own calculations!  As your mother undoubtedly said, “Would you jump off the roof just because someone told you to?”

Keep in mind that the teacher pay raise part of HB 3646 is contingent on the use of federal funds by the legislature being approved.  The money to pay for it is included in this template and there will be no other special payment.

5/13/09

Expenditure Targets

            2009-2010 Posted by TEA

The Texas Education Agency (TEA) is required to establish and publish proposed expenditure targets for each school district annually.  The targets for the 2009-2010 school year and more information about the targets can be found on the Expenditure Targets web page.

If a school district adopts a budget that does not meet an established target, it must adopt and publish a board resolution with a justification of why the target has not been met.  School districts should not submit the resulting budget or resolution to the TEA but should keep these documents as part of their financial records.

The target for instructional expenditures is aligned with the Governor’s Executive Order RP47, requiring school districts to spend 65% of school district funds on instructional expenditures, as the term is defined by the National Center for Education Statistics (NCES).  The 65% instructional expenditure target applies to all school district types and includes all funds.  Expenditure targets for all other spending categories are based on average expenditures from all funds for the two most recent years of actual Public Education Information Management System (PEIMS) financial actual data available per spending category and district type.  

The version of House Bill 3  passed by the Texas Senate includes the repeal of this requirement.  School business officials should check for the final status of this requirement at the close of the legislative session.

5/8/09

2007-2008 Summary of Finances Final

            Posted to TEA website

TEA has posted a letter explaining the final adjustments to the 2007-2008 Summary of Finances.  The letter contains a link to the page that will allow you to lookup the summary and associated documents for your district and details the data items that have possibly been updated. 

As the tax collections now come from the audit instead of survey data from several months ago, this item is likely to be different for most districts.  Attendance and any of the other data inputs may have changed as well as the result of final reports or corrections.

If your district has been underpaid, the amount owed the district is promised to be paid in May 2009. If your district has been overpaid, recovery of the amount overpaid will start in May 2009 and will be made by reducing your district's remaining FSP 2008–09 payments.  

The Payment Ledger for 2007-2008 is a separate report from the Summary of Finances and can be found further down the reports page.

In the world of school finance, final isn’t exactly as final as it sounds – it means that there are no more regularly scheduled updates.  There may very well be adjustments to the final for years to come.  The terminology, for those of you who care, comes from the days when much of the work was done by hand and using the computer to update one district’s summary of finances would require reprinting every district and then mailing them for the districts to check. 

5/7/09

Paying Employees While School is Closed

            FAQ from TASB Legal Services

You don’t have to be around school business for very long to realize that wage and hours and who gets paid how much and when for doing what can be really complicated.

The Texas Association of School Boards legal services has posted a Q & A document entitled School Closings and Other Employee Absences during Pandemics which discusses many of the issues involved.

Some of the issues discussed include:

Hourly employees and contracted educators are different

The local district can decide what to do, but should probably seek legal advice

If workers are paid while the district is closed, can they be required to work additional makeup days for no additional pay

Can employees who are suspected of having influenza be required to say home 

5/6/09

TEA encourages schools to reopen

Based on CDC flu guidance

From the News Release:

 In light of revised school closure guidelines from the Center for Disease Control and Prevention (CDC), the Texas Education Agency today is advising districts to reopen schools.

    The decision to close a school because of confirmed or probable H1N1 influenza cases remains a local decision. However, based on the new CDC guidance, both TEA and the Department of Health Services are recommending that schools reopen.    

The guidance from the CDC suggests that instead of closing:

… CDC recommends the primary means to reduce spread of influenza in schools is to focus on early identification of ill students and staff, staying home when ill, and good cough and hand hygiene etiquette.   

A number of schools have already announced that they will be reopening, but there are several issues that must be addressed. 

Financial – Texas schools receive state money based on average daily attendance (ADA.)  Students who are not at school because they are sick do not count in the attendance numbers.  In addition, there will be additional absences from students who have left town, don’t get the word that school is resuming or are kept home by parents who are not convinced that it is really safe to return.

When schools are closed, there is no attendance and those days are not counted when calculating the Average Daily Attendance.  For this reason the average attendance, the basis for state aid, is impacted very little by the days that the school was closed.  When school is open, however, higher than usual absences will decrease the average attendance and will have a negative impact on the districts’ income.

Communications – there are nearly 500,000 students out of school and that means that at least a million people need to get word that school is reopening – that’s the kids and their parents.  Getting that many people to understand what to do is always a challenge. 

Staffing – getting employees back to work will have all the same problems as getting the students back.

Information about waivers that can adjust for low attendance and testing issues can be found in the letters from TEA.  We are not finished with this yet, so keep checking back for further instructions.

4/29/09

To Close School or Not To Close?

            It’s never an easy decision

Whether or not to close school in the face of some future event is one of those whatever-you-do-is-wrong decisions.  The current issue is a flu epidemic, but it could just as well be a forecast for freezing rain or a hurricane two days away.  The point is, school closures of this sort are taken in anticipation of something that hasn’t happened yet.  If you wait until the kids are at school and the roads are frozen over, trees are  blowing over or everyone is sick it’s too late.

If ice is expected and the busses are left in the barn, part of the time, there will be no ice; or the hurricane will turn around and go the other way; or no one will get sick.  In the first two cases, everyone will know that the forecasted danger did not materialize, but an epidemic that didn’t happen is not so clear.  You can argue that closing the schools worked and lives were saved and suffering avoided.  Others will suggest, particularly when makeup days interfere with vacations that had been planned or even imagined, that the closing was unnecessary and showed weak will and administrative ineptitude.  

On the other hand, if school stays open and the roads are icy, the storm devastates the community and classrooms are half filled with listless children and feverish teachers for weeks, it’s a sign of reckless bravado, willfully endangering innocent children and administrative ineptitude.  

President Barack Obama said Wednesday that schools with confirmed cases of swine flu should consider closing. An AP story in the Houston Chronicle also reports that the Centers for Disease Control has recommended that schools strongly consider dismissing students when there is a confirmed or suspected case.

A number of Texas schools have already closed.  One of the largest and longest closures so far is all of the schools in Comal County.  An article in the New Braunfels Herald-Zeitung explores the reasons for the decision to close.  Both New Braunfels ISD and Comal ISD are contacting TEA about what to do next about makeup days and the TAKS testing.

The education blog homeroom in the Austin American-Statesman also reports on the Comal County closures.  The public comments here show the differences of opinion about what to do.  A Brownsville Herald story about the Rio Grande City school closure puts a more human face on the decision. 

4/28/09

Flu Guidance from TEA

            Letter from Commissioner

TEA has posted a letter giving districts more direction if the swine flu has caused school closings or unusual absences.   http://ritter.tea.state.tx.us/taa/comm042709.htm

Some of the highlights from the letter:

In the event of a school district/campus closure during the TAKS-testing window, please contact Cathy Kline in the Student Assessment Division at Cathy.Kline@tea.state.tx.us for further guidance.

Waiver applications for both missed instructional days and low attendance are available at: http://www.tea.state.tx.us/waivers/waiverapps.html.

Public schools should prudently evaluate the health of current students and new arrivals.   

4/27/09

Swine Flu

            School closings, advice

For authoritative information, go to the Texas Department of Health Services Swine flu page.  http://www.dshs.state.tx.us/swineflu 

The current swine flu outbreak illustrates another of the functions of public schools that are not exactly what most people would think of as instruction.  In Texas, the schools are the largest and most pervasive public health agencies. 

We enforce vaccination of children and the school nurses are often the first to be aware of infectious disease outbreaks.  Isolating sick children and sending them home is an effective way to slow the spread of such diseases.  Indeed it is an ancient method that long predates any understanding of how diseases actually spread but contact with the infected was known to be part of it.

We have progressed beyond the biblical leper crying out “unclean” and the inspections at Ellis Island, but quarantine remains an effective tool and to this day, cruise ships still fly a yellow flag requesting health clearance when entering a port.  The Centers for Disease Control (CDC) provides a guide to current practice.  

4/20/09

Data Collection of DUNS Number, CCR CAGE Code, and U.S. Congressional District Number

 Required for Award of ARRA (aka “Stimulus”) Funds

TEA has posted the letter which gives the instructions for verifying the registration numbers and congressional district.  The link to the survey for reporting them is: https://landry.tea.state.tx.us/TEA_Survey/Grants/arradata/arradata.htm

From the letter:

All school districts, regional education service centers (ESCs), and charter holders that wish to receive ARRA funds must have a DUNS number and must register in CCR (and be assigned a CAGE code on completion of CCR registration) to be eligible to receive a Notice of Grant Award (NOGA) for any of the federal ARRA funds. TEA realizes this requirement could be burdensome for some grantees; however, TEA is required to enforce the ARRA statute and OMB rules to comply with these provisions.

The letter also includes detailed instructions for obtaining the numbers and reporting them.

4/16/09

 Propane Bus Grants

            Railroad Commission seeking grant

The Texas Railroad Commission is inviting districts to partner with them in grant proposals to the U.S. Environmental Protection Agency for $5 million and the U.S. Department of Energy for $15 million. If successful, the EPA grant will pay up to half the total cost of a propane bus that replaces an old diesel bus in an air-quality non-attainment area.   

Districts that are outside of non-attainment areas have another option: The DOE grant will apply statewide, regardless of air-quality classification, and pay the incremental cost of the propane option (estimated at $14,000).   

Districts in air-quality non-attainment areas also may be eligible for additional funding from the Railroad Commission’s TERP-funded propane school bus program, which can pay up to $30,000 of your matching funds for new buses that replace older diesel buses.  More information about TERP program can be found on the TRRC web site. 

To participate in the EPA proposal, please respond by close of business Tuesday, April 21.  For the DOE proposal, please respond by Friday, May 8. 

For more information, including assistance completing the fleet worksheet and questions about non-attainment areas, contact Heather Ball at (512) 463-7359 or heather.ball@rrc.state.tx.us.   

4/13/09

DUNS Number and Central Contractor Registration Required for Receipt of American Recovery and Reinvestment Act Funds

            Reminder from TEA

From the letter:

On or about April 13, a data collection form to collect your DUNS number and CCR CAGE code will be provided to you. That data collection form and the instructions will be posted to the TEA Correspondence page at http://ritter.tea.state.tx.us/taa/sortf.cgi?command=bydate when it is available.

It is likely that school districts already have both of these registrations, but check on it as soon as possible.  As it is possible for a district to have multiple registrations, there needs to be a district wide coordinated response to avoid confusion.

The letter contains more information and links to the registration sites. 

4/13/09

Food Service Equipment Grants

            Stimulus money available now – April 30^th deadline to apply

The American Recovery and Reinvestment Act of 2009 (ARRA)  provides a one-time appropriation of $100 million for equipment assistance to school food authorities (SFAs) participating in the National School Lunch Program (NSLP). Texas will distribute an allocation of $11.5 million among SFAs that competitively apply for these grants. 

The Texas Department of Agriculture has a webpage devoted to this program.  Applications must be submitted by April 30^th through a link on the page.  There are a number of other resources on page including  a School Nutrition Association webinar which can help with the selection of equipment.

4/9/09

Stimulus Funding Information from TEA

            Separate application and accounting required

TEA has posted a letter dated April 6^th giving the first detailed information about federal stimulus money to schools.  Important points include:

Even though the money is an increase to existing programs; a new, separate application for each program will be required

The money must also be accounted for separately

Applications for some programs will be available soon and some will not be available until the Fall of 2009

From the letter:

In addition to the regular federal funds allocated to Texas LEAs for the 2009-2010 school year, supplemental ARRA funds will be allocated separately over the next few months to various federal grant programs as follows:

No Child Left Behind (NCLB) Title I, Part A: The application for this allocation will be available on or about April 15, 2009.

Title I, School Improvement Grants (School Improvement Program [SIP] Academies): The application for this allocation will be available between September and October 2009.

Title II, Part D (Education Technology): The application for this allocation will be available Fall 2009.

Individuals with Disabilities Education (IDEA), Part B, and IDEA, Part B—Preschool: The application for this allocation will be available on or about April 15, 2009.

USDE has notified TEA that the ARRA stimulus allocations must be coded, accounted for, and reported separately from the LEA’s annual federal allocations. For this reason, LEAs must apply for the allocations of ARRA funding through separate applications. All formula applications will be available in eGrants. Preliminary planning amounts for these allocations will be posted on or about April 8, 2009, to the TEA Grant Opportunities website at http://burleson.tea.state.tx.us/GrantOpportunities/forms/GrantProgramSearch.aspx .

4/6/09

LBB Publishes School Finance Study

            FOUNDATION SCHOOL PROGRAM FISCAL AND POLICY STUDIES

The Legislative Budget Board (LBB) has published a study of the current Texas school funding system. 

This study is worth special attention as it is not the product of an interest group with some special ax to grind as the LBB website describes its purpose as: 

The Legislative Budget Board (LBB) is a permanent joint committee of the Texas Legislature that develops budget and policy recommendations for legislative appropriations for all agencies of state government, as well as completes fiscal analyses for proposed legislation. The LBB also conducts evaluations and reviews for the purpose of identifying and recommending changes that improve the efficiency and performance of state and local operations and finances.  

Among the “Significant Findings” of the report is the following statement:

The equity of the public school finance system, as measured by the analysis presented here, has declined since the implementation of the related statutory provisions of the 2006 legislation.

This is an exceptionally troubling finding as the constitutionality of the Texas school finance system has in the past been successfully challenged as inequitable.

4/2/09

Texas Senate Passes Appropriations Bill

            Now the House has a turn

The appropriations bill (Senate Bill 1) which is the state budget for the next two years is about the most complicated thing the legislature does and they have to do it every time they meet.  This time the Senate is first out with a bill, but the state spending plan is far from finished.  The House now gets to pass one and the House version is as likely to be struck by lightning while standing on an alligator in a snow storm as it is likely to be the same as the Senate version.

The differences will be resolved in a conference committee and, as a practicality, just about everything is up for discussion there.  In addition to determining how much to spend for each of the thousands of items and programs, the whole thing has to fit within the amount of money available. 

Issues that must be resolved include:

At this point, no bills that would actually change the way the state spends money have made it all the way through the legislative process.  Check the TASBO Bill Status page to see where various proposals are in the process.  TASBO is tracking more than 1,000 bills which will have some impact on school business, so you may need to use the search function in your web browser to find what you are looking for.

Senate Bill 1 uses some of the Federal Stimulus money.  The rules for the use of this money are still evolving, so this may have to change.  Check the TASBO stimulus link page for a number of sources of information on this issue.

The Texas Comptroller certifies the amount of money that will be available.  That amount often changes between the time first estimate is prepared just as the session begins and the end of the session when the time comes to certify that there is enough money available.  There is some speculation that the estimate may go down this time instead of up as it has often done in the past.  The Dallas News Politics Blog reports on this and some of the other issues in the budget. 

3/3/09

Stimulus Funding

                Information becoming available

The Texas House of Representatives Select Committee on Federal Economic Stabilization has a website, Txstimulusfund.com, which contains information about the committee hearings including links to other sites and the handouts from the committee hearings.  There is an email list to keep you updated when new information is posted.

The Texas Comptroller of Public Accounts has created a website, Tracking the Texas Stimulus to share the best available information about the American Recovery and Reinvestment Act of 2009.  There is a link to a long spreadsheet showing what is known so far.  This website allows you to sign up to receive an email notice every time more information is available.

ASBO International also has an Economic Recovery Planning for Schools page which covers the program from a national perspective.  There is also a blog for sharing questions and answers on this website.   

3/2/39

Automated External Defibrillator Reimbursement

            Second round funding available from TEA

In a letter date February 23^rd, TEA announced the availability of additional funding for AEDs.  Links to the application and detailed instructions are in the letter.

This round of funding provides an opportunity to request reimbursement for purchases to meet the Senate Bill 7 mandate and/or for any additional purchases made by a campus to meet University Interscholastic League availability standards.  Senate Bill 7, Section 38.017 requires that each school district and open-enrollment charter school shall make available at each campus at least one AED.

The application deadline is April 15^th, but it is first-come, first-served funding, so don’t wait till near the deadline to apply.

2/20/09

School Finance Bill Filed

            Senate Bill 982

Senators Van de Putte, Eltife and West have filed Senate Bill 982 which will, if passed as filed, make substantial changes to the funding formula and shifts much of the funding away from the hold harmless provisions and back to the formula.  As of the morning of February 20^th, there was no fiscal note or bill analysis posted on the legislature’s website.

The bill is Take a look at the bill and keep checking back for more information. 

2/19/09

TRS ActiveCare Rate

            2009-2010 Rate increases

The Teacher Retirement System of Texas has posted the rates and benefits for TRS-ActiveCare for the 2009-2010 plan year beginning September 1, 2009 and for the Health Maintenance Organizations (HMOs) participating in TRS-ActiveCare. 

Add this to your list of things to consider for next year’s budget.

2/16/09

Stimulus Bill Estimates

            Link to the US House Education and Labor Committee

This link http://edlabor.house.gov/blog/2009/01/school-districts-will-benefit.shtml to the US House Committee on Education & Labor gives a first look at the impact of the stimulus bill just passed by the US congress. 

Notice that they have gone to some pains to indicate that this is an estimate.

2/13/09

Education Committees Appointed

            House Committee membership announced

Follow this link to see all committees

  View Membership History  

Bills In/Out of Committee | Meetings

Bills In/Out of Committee | Meetings  

2/11/09

CPTD Values Posted

            Preliminary 2008 Values to be used in 2009-2010 State Aid calculation

The comptroller has posted the preliminary 2008 tax year values.  These values will be used in the state aid calculations for school districts in the 2009-2010 school year. 

Just to keep things confusing, the taxes were due locally on the 2008 tax roll in January of 2009 which is the 2008-2009 school year.  The comptroller is charged with producing a set of values which have been adjusted to a state standard of full market value for use in the following school year which is 2009-2010.

Go to this page  which lists all the counties to select the county in which your district is located.  This page also contains links to protest procedures and under Property Value Study and Self Reports more detail about the study and how it was conducted.

Property value still matters and, if the comptroller has not assigned local values or there are errors in the report, there is a limited time period to appeal.  A lower state value will almost always result in some additional money for the district.

Tips:

The law was changed to require that all property be appraised by the county in which it is located, so there are multiple tables for many districts.  Scroll all the way to the bottom for the total.  This is the first year for this, so be especially alert for any errors.

Use the T2 value on the State Aid Template for 2009-2010 – do NOT use it for any other year. 

2/2/09

Senate Education Committee Appointed

Follow this link to see all committees.    

  View Membership History

Bills In/Out of Committee | Meetings  

1/22/09

State Budget Proposals Made Public

            More money for schools proposed by both House and Senate

The budget issues for the 2009-10 and 2010-11 biennium are discussed in a January 21^st Dallas News article.  The actual budget proposals are on the Legislative Budget Board web site.

At this point in the process, it is best not to get too attached to the details as there are substantial difference between the House and the Senate proposals and the actual bill appropriating the money is often one of the last things passed by the legislature.

1/5/09

Changes to Mileage Reimbursement Rates

Effective January 1, 2009, Applicable to State and Federal Grants from the Texas Education Agency

Reminder letter from TEA:

Effective January 1, 2009, the automobile mileage reimbursement rate (in-state and out-of-state) for personal automobiles has decreased from 58.5 cents per mile to 55 cents per mile or local policy, whichever is less.  Lodging and meal rates have not changed.

See the TEA letter ( http://www.tea.state.tx.us/taa/grants123108.htm ) for more details.

12/16/08

Permanent School Fund Bond Guarantee on Hold

            Reported by Houston Chronicle

A December 16^th article in the Houston Chronicle reported:

The ailing economy could make it more expensive for Texas school districts and their taxpayers to borrow money as the state has temporarily postponed its school bond guarantee program, which helps lower interest costs for construction projects.

About 20 Texas school districts — none in the Houston area — are immediately affected. More districts potentially could feel the impact as they consider selling bonds for various school construction programs already approved by voters.

TexasISD.com is also reporting the story.  This report contains a link to a copy of the letter sent to districts and a list of the impacted districts.  More information about the bond guarantee program is available from TEA. 

12/12/08

Public Education Grant (PEG)

            2009-2010 Eligible campus list posted

The Public Education Grant (PEG) program grants additional state aid to districts which accept transfers from low performing campuses in other districts.  The letter from TEA explains how the program works and contains links to other pertinent documents. 

Some highlights of the program:

Students from the any campus may request to transfer to another district.  All districts can count the attendance of transferred students for state aid.  The attendance of students from the qualifying campuses will earn 10% more state aid than other transferred students.

No district can forbid transfers away from a campus.

No district is required to accept transfers.

The PEG program does not override any federal law or court order limiting transfers.

If a district accepts transfers, the district can limit the number of transfers accepted by district policy.  The policy cannot discriminate against PEG transfers, however.  See the FAQ document for more information.

Neither the home district nor the district accepting the transfer is required to provide transportation to the new campus.

11/14/08

2008-2009 Summary of Finances

            The data explained 

TEA has posted this letter dated November 12^th explaining where the data on the 2008-2009 Summary of Finances came from.  This SOF has been used since September to make payments to districts.  Go to the State Funding Website to look at the report for any district.  Reports for previous years and a lot of other information are also available.

There are two columns of data on the SOF.  The left hand column is the estimate that is used to make payments to the district during the year.  Payments will be adjusted to actual earnings after the close of the year. 

The right hand column is a more current estimate of actual earnings.  At this time, both are very much an estimate.  The district budget needs to be based on the state and local income that the district will actually earn during the year and neither column on the SOF can be relied up for this purpose.

The letter ends by exhorting districts to make their own best estimates:

As always, the TEA strongly advises your school district to project state aid based on the best available information. Your district should complete the 2008–09 state aid template or an equivalent state aid estimation process. The greatest value of the SOF is in explaining the basis of cash distributions to districts. Estimation of state aid earned can be significantly impacted by factors not known to the Division of State Funding. 

Computer templates to make these estimates are available from ESC 13 and ESC 12.  The ESC 12 template provides for entering raw attendance data each six weeks and automatically updates the estimate using the year to date information.

Read the TEA letter carefully to see where the data they are using can be incorrect for your district and adjust your estimates accordingly.  Pay special attention to the property value assigned to the district by the comptroller.  Use the value from the right hand column unless you have more recent information from the comptroller.

11/13/08

New Instructional Facility Allotment 2008-2009

Allotments prorated 

TEA has notified districts that the application period for the New Instructional Facility Allotment has closed and that there is not enough money appropriated for districts to receive the full amount.   This program provides additional operating money for the first two years a new campus is operated to help with move-in expenses.  It is not related to the Instructional Facilities Allotment or the Existing Debt Allotment which assist districts with the debt issued to construct buildings.

Information about the New Instructional Facilities Allotment can be found here.

Proration is based on tax base rather than as a percent of the total allotment.  The program description document explains:

Allotment Proration:  The amount appropriated for NIFA is limited to $25 million per school year.  If the total amount of allotments to which all districts are entitled for a school year exceeds the amount appropriated, the commissioner will reduce each district’s allotment so that the total amount to be distributed equals the total amount available.  Reductions to allotments are made by applying the same number of cents of tax rate to each district’s taxable value of property.  For each district, the taxable value of property is the property value certified by the Comptroller for the preceding school year as determined under Subchapter M, Chapter 403, Government Code, or, if applicable, a reduced property value that reflects either a rapid decline pursuant to TEC §42.2521 or a grade-level adjustment pursuant to TEC §42.106.

Also remember that these allocations are estimates for the 2008-2009 school year which will be adjusted after the end of the year by the actual attendance on the campus.  The adjustment process may also result in a change in the proration rate. 

11/5/08

Other states’ finances in the news

Wisconsin investment woes

Other states’ financial woes are in the news this week.  The Wisconsin problem involves several districts which bought into a high yield investment.  Some the money was borrowed from a bank in Ireland.  The New York Times article indicates that the extra income was needed to fund teacher retirement obligations of the districts.  An article in The Bond Buyer provides a lot more technical information about the transaction which involved collateralized debt obligations which have now lost much of their value.  The districts are now considering their investment advisors for misrepresenting the risk involved.

While Wisconsin was among the first to begin pension coverage, teacher retirement system remains fragmented and not all school employees in all districts are covered by the state system.  In addition, a number of independent retirement systems have been consolidated over the years leaving local districts with the obligation to fund retirement obligations.  This white paper from the Wisconsin Legislative Fiscal Bureau explains the system.  This is very different from the Texas system in which all school employees participate in the Teacher Retirement System of Texas which is responsible for all retirement obligations.  Local district pension payments are limited to the employer’s share which is paid to TRS along with the employee’s contribution. 

The borrowing and investing environment in Texas is apparently also more constrained.  Texas school districts’ ability to borrow is generally found in Chapter 45 of the Texas Education Code and is usually tied to bond elections and other facility and maintenance needs.  The Financial Accountability System Resource Guide which all Texas school districts must follow provides more detailed guidance.  Similarly the FAR provides detailed information about the investment of school funds.  A publication, Banks to Bonds provided by the Legislative Budget Board provides a more general explanation.  The permissible investment types which does not include more exotic investments from this publication are:

Obligations of, or guaranteed by governmental entities;

Certificates of deposit and share certificates;

Repurchase agreements;

Banker’s acceptances;

Commercial paper;

Mutual funds;

Guaranteed investment contracts; and

Investment pools 

11/5/08

Kindergarten Reading Test Data Submission

            Raw scores to be submitted to TEA

Senate Bill 1871 requires the superintendent of each school district to electronically report each kindergarten student’s raw score on the kindergarten reading instrument (TPRI or Tejas LEE) each year.

To submit the required data for the 2008-2009 school year, school districts and open-enrollment charter schools will use the FERPA-compliant web-based reporting system. The system is provided at no charge to the district and will be available for data entry beginning November 4, 2008 (district-wide data uploading will begin November 11, 2008) and continuing through December 19, 2008.

More information and links to the data site are included in this letter from TEA.

10/30/08

Pre-K Funding Rule Change Proposed

            Would allow new districts and change allocations to existing programs

TEA has posted a proposed change for the Commissioner's Rules Concerning Early Childhood Education Programs, §102.1002, Prekindergarten Early Start Grant Program

Currently, half day Prekindergarten attendance is included in the total attendance for the district.  The other half day may be funded by grants.  This rule change would not change the half day formula funding and could impact the grant funding.

Some highlights from the rule change posting:

Since 1999, funding allocations under the Prekindergarten Expansion Grant Program have been made only to local educational agencies that received grant funding in the previous year and have been based on the number of prekindergarten students, days of instruction, and percentage of attendance.

The proposed new rule would allow the commissioner to make grants to school districts and open-enrollment charter schools from funds appropriated for the program beginning with the 2009-2010 school year (fiscal year 2010). For fiscal year 2010, the grant would require sharing use of an existing Head Start or child care program site as a prekindergarten site.

Under the new proposed rule, a percentage of this revenue source would be available through a competitive application process to a new group of grantees that have not participated in the program previously.

10/28/08

Free email domain name registration for LEAs

            The state will do it for free

The Texas Department of Information Resources is the administrator of the *.tx.us domain, and as such can offer free domain name registration for LEAs that would like to have an address such as [district].k12.tx.us.  This registration does not expire, so LEAs never have to worry about losing it.  

Contact information is available in this letter from TEA.

The downside of this offer is that the district will need to use the .tx.us domain which may involve changing from a different one that is already well publicized.

9/8/08 (Posted 10/16/08)

School Funding Back on the Table?

            The Dallas Morning News thinks so 

A Dallas Morning News September 7^th editorial suggested, “Legislators again must figure out how to adequately fund the state's public schools.”  The editorial suggests that shortfalls in the income from the new business tax and the increasing number of districts that are falling into Chapter 41 and must share local tax revenues are the cause.  Significantly, the list now includes both Dallas ISD and Houston ISD, the two largest districts in the state. 

A number of other issues could be added to this short list.  A few of them are: 

The number of districts holding elections to increase the tax rate.  (103 on an unofficial list compiled by TexasISD.com)
The number of districts spending fund balance.
The pressure to increase salaries
The fixed income per Weighted ADA imposed by the current hold harmless funding formula.  

In order to stimulate the conversation, TASBO will begin posting issues in the funding system and inviting comments and suggested solutions by TASBO members.  Think of this as The McLaughlin Group, the Sunday talk show featuring shouting and disagreements, so tell us what you think. 

Access to the discussion can be found in the Members Only section of the TASBO webpage in the School Finance Community. 

Issue #1.
The current operating funds per WADA available to each district in the state is governed by the Additional State Aid for Tax Reduction hold harmless provision.   

This provision guarantees a certain Target Revenue per WADA in combined state and local operating income at a specific Compressed Tax Rate and was designed to compensate for the reduction in tax rates beginning in the 2006-2007 school year.  As all districts including Chapter 41 districts, currently receive this allocation, it effectively controls the income for all districts.

10/8/08

Automated External Defibrillator Reimbursement

            Funds available from TEA

Each school district, open-enrollment charter school, or private school campus that did not have an AED located at a campus prior to June 1, 2007, and purchased an AED device on or after June 1, 2007, is eligible to receive reimbursement for one AED.   The letter announcing the grants contains more information and links to the application form.  The application deadline is November 17, 2008.

10/6/08

2007-2008 Summary of Finances

            Letter explaining the updates

TEA has posted a letter dated September 30^th explaining the updates to the Near-Final Summary of Finances.  The antepenultimate version of the 2007-2008 state aid has been available for several weeks but the numbers have continued to change and it was up to each district to figure out which items had been updated.

To summarize, most of the information is from actual 2007-2008 school year reports, with the following exceptions.

New Instructional Facility Allotment (NIFA) – The NIFA allotment shown on the SOF has not been changed to reflect actual ADA related to this program. The actual NIFA amount earned in 2007–08 will be reflected on the final version of the SOF in April 2009.

ADA Decline Adjustment –Districts with declining enrollments will be  funded at 95.60 percent of the ADA they had in 2006-07. A report entitled Adjusted ADA Detail Report provides the details of this calculation.
The percent of the prior year ADA can be as high as 98% but is limited by the amount of funds available.  Based on the funding available for 2007-2008, districts should not expect the full 98% in 2008-2009 either.  This will be a concern for districts that were impacted by the hurricane.

Total Tax Collections – The M&O and I&S tax collections your district reported on the Tax Information Survey in summer 2008 have been used on this SOF.   This will be adjusted to the audited amount in April of 2009.

State Aid Reduction for WADA Sold – The number of WADA being sold does not reflect the “near-final” WADA that the Chapter 41 district must purchase. The number of WADA bought/sold may need to be adjusted depending on the “near-final” Chapter 41 Cost of Recapture report. 

Public Education Grant Allotment – The Public Education Grant allotment is not included in this SOF.  It will be incorporated on the final version of the SOF in April 2009.   

If the district has been underpaid, the amount owed the district will be paid in October 2008.  If the district has been overpaid, recovery of the amount overpaid will start in September 2008 and will be made by reducing the district’s 2008–09 monthly payments from the Foundation School Fund.

10/3/08

Attendance and Budget Forecasting Tools

            Updated TASBO and ESC 12 & 13 templates

TEA recently made the attendance forecasts that will be used to advance money to schools during the 2009-2010 and 2010-2011 school years available to districts for inspection and input.  The 2008-2009 TASBO Pupil Projection template is now available on the TASBO home page.

This template contains a history of attendance and enrollment for all districts and will automatically project attendance for several years using three different approaches after the district supplies by grade for the 2008-2009 school year.

The TASBO template Mid Year tab provides a method for estimating final current year attendance from partial year attendance.

The ESC 13 templates calculate state aid.  The latest “reality check” template will automatically fill in all the data that is on the 2008-2009 Summary of Finances and provides a column for the district to enter the “real” data in order to generate an estimate of actual earnings.  The difference between these is the reason the district needs to be concerned about the attendance estimates that are being proposed by TEA.

ESC 12 provides several templates which are geared toward budgeting and immediate operational needs.   The LPE.DPE templates provide a handy way to enter attendance each six weeks to generate a current forecast of actual income.   

10/1/08

Latest Hurricane Information

            FEMA workshop at Harris County Department of Education

            Waver information from TEA 

The Harris County Department of Education School Finance Council meeting on October 20^th will feature information from FEMA.  From the announcement:

How to get reimbursed for emergency work and restoration!

Disbursements of payments and other items

Presentations from: William Boone, FEMA and Dept. of Homeland Security

Philip Anders, State Governor’s Division of Emergency Management (GDEM)

The TEA Hurricane Information website has been updated.  The latest correspondence includes the follow succinct statement of the makeup day policy:

Districts that were closed because of the hurricane in the 29 disaster declared counties in Texas are eligible to apply for a missed instructional days waiver.  Districts that obtain this waiver may shorten their school year by up to 10 days.  As in the past, districts that were closed due to a hurricane are not required to use their two bad weather make-up days.  By obtaining this waiver, districts will not lose funding due to the days they were closed. 

10/1/08

LPE Attendance Estimates 2009-2011

            TEA estimates available 

TEA has made the attendance estimates that will be used for the LPE column of the Summary of Finances for the 2009-2011 available for review and input by the district.  The message from TEA: 

The 2009–2011 pupil projections will be available in the Foundation School Program (FSP) Payment System Pupil Projections module to review and edit from Wednesday, October 1, 2008, through Friday, December 12, 2008. Finalized projections will be sent to the Legislative Budget Board and will be used to estimate your FSP payments as part of the legislative planning estimate (LPE). 

You can log on to the FSP Payment System from the following link: http://www.tea.state.tx.us/school.finance/fsp.html. Once you have logged on to the system, select Pupil Projections from the Programs menu, and select Projections Worksheet to view and/or edit the projection data. 

If you have questions or would like additional information, contact Belinda Dyer, director of the Forecasting and Fiscal Analysis Division, by email at belinda.dyer@tea.state.tx.us or by phone at (512) 475-3451. 

It is more than important that every district review these estimates carefully as they will control cash flow to the district for the 2009-2010 and 2010-2011 school years. 

The Summary of Finances has two columns.  The left hand column, the Legislative Payment Estimate (LPE) is used to make payments throughout the year, but the amount is adjusted to the amount actually earned during the year after the year is over.  Look up your district here to see the difference between the projection and actual for any past year. 

In 2006-2007, the state recovered a net of $385,000,000 from districts which were overpaid.  What the total recovery doesn’t explain is that there were also payments ranging up to tens of millions of dollars.  Almost every district in the state can expect either an adjustment or an additional payment.  The 2006-2007 report also shows the amount which was recovered from years before 2006-2007. 

Receiving either too much or too little state aid during the school year is difficult to manage effectively as it is all too easy to spend cash that has not been earned and equally difficult to operate the entire year without the cash that is being earned.   

TEA has very limited ability to adjust the attendance estimates after they have been submitted to the legislature, so we really need to get the most accurate projection into place now.  ADA is important, but the special program counts may be even more important so be sure to include any planned changes in these programs in your review. 

9/22/08

Surplus Property Available

            All districts are eligible

The Texas Facilities Commission administers the Federal Surplus Property program.  All Texas school districts are potentially eligible and items that can help with the cleanup and provide quick replacements for storm damaged equipment and supplies may be available.

9/22/08

ADA and IDEA

            New bill on president’s desk

Education Week is reporting that a new bill which could have budget implications for school districts is on its way to becoming law. 

The bill is a response to court decisions that had narrowed the protections for people with disabilities.  If signed into law by President Bush, the measure would also mean changes for Section 504 of the Rehabilitation Act of 1973, which predates the better-known Individuals with Disabilities Education Act.

The IDEA, first passed in 1975, requires schools to give students with disabilities individualized education programs designed to meet their education needs.  As the students who must receive additional services are not necessarily in Special Education, there may not be additional funding to cover the additional cost.

9/22/08

School Bus Emissions Grants Available

            TCEQ announces deadline extension

The Texas Commission on Environmental Quality’s (TCEQ) Texas Clean School Bus Program is a program authorized by the legislature to reduce air pollution from school busses.  There is other information on the website in addition to the grants.  From the TCEQ web site:

Application deadline extended to Dec. 15, 2008

The TCEQ announced on August 15, 2008, it is now accepting applications for funding to retrofit school buses. The retrofits will reduce emissions and create a healthier environment for children riding the buses. Applications are processed on a first-come, first-serve basis through December 15, 2008 as funds are available.

9/18/08

Facilities Standards Rule Updated

            Implements portable building requirements

TEA has posted the final rules implementing the extension of facilities standards to portable buildings.  From the notice: 

BACKGROUND INFORMATION AND SIGNIFICANT ISSUES: Through 19 TAC §61.1036, adopted to be effective June 9, 2003, the commissioner exercised rulemaking authority to specify in rule standards for the construction and adequacy of school facilities. The current provisions include requirements for the certification of the design and construction of school buildings, space and square footage requirements for these buildings, construction quality standards for these buildings, and definitions of applicable terms.  

HB 1886, 80th Texas Legislature, 2007, amended the TEC, §46.008, relating to school facilities standards, to include requirements that portable, modular buildings for use as school facilities be inspected for compliance with mandatory building codes or approved designs, plans, and specifications. The adopted amendment to 19 TAC §61.1036 incorporates these statutory changes, as well as other updates and revisions, as follows. 

Subsection (a) has been revised to include definitions for architect, engineer, and portable, modular building. The paragraphs in the subsection have been renumbered accordingly.

Subsection (f) has been revised to modify the requirements for a qualified building code consultant in paragraphs (1)(A) and (2)(A) and the definition of qualified code inspector in paragraphs (1)(D) and (2)(D). New paragraph (3) has been added to address special provisions for portable, modular buildings. Subsection (f) has also been revised to update the name of a state agency in paragraph (4)(B) and a statutory reference in paragraph (4)(D).

Technical corrections have been made throughout the section to correct references, word usage, and punctuation. 

No changes were made to the rule since published as proposed. 

9/16/08

Hurricane Ike FAQ

            Student enrollment information from TEA 

TEA has posted a FAQ document covering the following topics.  It can also be reached from the menu on the left side of the Hurricane Information Site.  

 All of the topics except for Emergency School Board Meetings involve student issues and usually turn on whether or not the student meets the federal definition of homeless.   

“If a family has lost or otherwise cannot use their home due to the hurricane, the children are homeless under the federal McKinney-Vento Act and can immediately enroll elsewhere….”   

“If your school district is closed but will reopen under an adjusted calendar and the child’s home is habitable, the child is not homeless simply because his/her school district is forced to follow a different calendar….” 

“A school district or charter school may make reasonable inquiries to establish that a student is homeless. A student who is staying in a shelter or who recently began sharing space with relatives qualifies as homeless. It is reasonable to accept identification showing that the parent is from the areas evacuated as evidence that a student is an evacuee eligible for services as a homeless student. A utility bill or similar documentation should not be required under these circumstances.” 

Read the FAQ carefully and then do what’s best for the kids.

9/15/08

Evacuated School Children

            Message from TEA 

Due to the severe conditions that Hurricane Ike is imposing on coastal Texas, especially in ESC Regions 4 and 5, it may become necessary for all school districts to admit evacuated school children.  

Districts should follow the same procedures implemented at the time of Hurricanes Katrina and Rita. Those procedures will be posted on the Agency’s home page (http://www.tea.state.tx.us) under Hurricane Information later today.  

Any child presenting themselves should be immediately admitted. It may be impossible to ascertain the exact status of the child because district records may not be immediately available; nonetheless, districts should enroll them at face value vis-à-vis their parent or guardian’s statement of grade level attainment and special program status.   Sep 15, 2008, 08:39

9/15/08

TexPool and Lehman Brothers

            Information from the website 

The following memo regarding Lehman Brothers was posted on the TexPool website on September 11^th.  It’s in a popup window, so it may have been blocked.   

Contact information and FAX and Voice Response Unit information is available on the website.  

Memo from Texas Treasury Safekeeping Trust Company

September 11, 2008

Re: Lehman Brothers and TexPool/TexPool Prime

Considering the recent media attention focused on Lehman Brothers, we wanted to ensure that you understand the following regarding your investment in TexPool and TexPool Prime:  

 Any potential adverse news or performance of Lehman Brothers has no impact on the safety of your investments in either of the Pools.  

 Lehman Brothers Inc. provides participant and marketing services.  

 Federated Investors, Inc. manages the investments of both TexPool and TexPool Prime.  

 Participant records and client accounting are maintained by Federated.  

 Federated does not engage Lehman as a broker in any transaction for the Pools because doing so would violate conflict of interest requirements of the agreement with the Texas Comptroller.  

 TexPool and TexPool Prime securities are held in custody accounts, for the benefit of TexPool and TexPool Prime, at State Street Bank.  

We are monitoring the status of Lehman Brothers Inc. closely. As always we welcome your questions and thank you for the confidence that you place in our Texas Local Government Investment Pools.

9/10/08

Lost / Low Attendance Instructional Days

            Hurricane days excused 

Here is the information from TEA about days of instruction lost to hurricanes.  It’s in the instructions to Section 4 of the form: 

Missed Instructional Days, pursuant to TEC §25.081.  Allows the district or campus to request a waiver if instructional days are missed due to weather, health, or safety related issues be excused.  The first two days missed due to bad weather must be made up using the two scheduled make-up days. *Hurricane days are not required to be made-up. 

There is nothing special for hurricanes for low attendance days – attendance just must be 10% below average.

9/10/08

2007-2008 Near Final Summary of Finances

            First settle-up information posted 

The TEA Division of State Funding has begun posting the Near Final Summary of Finances for the 2007-2008 school year.  As of the morning of September 10^th, however, there was no explanatory letter, so it is safe to assume that what you can see is not necessarily the final word.   

The Payment Ledgers for both 2007-2008 and 2008-2009 also show adjustments.  Districts that were overpaid during the 2007-2008 year will have the excess credited as already paid for 2008-2009 and those that were underpaid will receive an additional payment.   

Notice that the 2007-2008 payment dated August, 2008, was calculated before the allocation was updated.  The adjustments for overpayment in 2007-2008 have been charged to 2008-2009 before the first payment for that year has been calculated. 

This is the first opportunity to see if the additional payment or recovery is close to the amount which the district is expecting.  Keep checking back is this information is likely to continue to change.  Actually, expect changes.

8/28/08

Summary of Finance Information

            TEA has posted a FAQ 

TEA has posted the following succinct information on the School District State Aid Reports webpage: 

It has always been true, or has been true for at least thirty years, that state aid is advanced to districts on an estimate that is sure to be somewhere between a little and a lot wrong and this is corrected to the amounts that the district has actually earned long after the next school year has begun. 

We can add: 

5.  WHEN WILL THE FINAL SUMMARY OF FINANCES BE PUBLISHED:  ANSWER:  NEXT SPRING

6.  WILL THERE EVER BE A TIME WHEN TEA WILL QUIT MAKING ADJUSTMENTS TO 2007-2008?  ANSWER:  NO 

School business officials can’t wait until a year is six months over to make a budget for the following year, so they must make their own estimate of actual earnings for the year just ending and potential earnings for the next year as well.  The tool for making these estimates is an Excel spreadsheet supplied by ESC 13.   

Like the song says, you also need to check it twice to be sure that you are using the latest and best numbers.  The spreadsheet has changed repeatedly during the year as the funding law has become more complicated.  It last changed on August 27^th.  The latest changes impact only a few districts.  Read the notes page to see what situations had to be addressed this time. 

8/27/08

Standardized Grade Point Average

            AG issues opinion 

A 2007 law required that a standardized grade point average be used to determine the 10% of graduating seniors who are guaranteed automatic admittance at state higher education institutions.  

How to do this is not as simple as it might seem.  Follow the link in the article to see how differently several Austin area districts currently compute grade point averages.  Attorney General Greg Abbott issued an opinion about how the standard method is to be implemented on August 26^th.  The clarifying opinion, however, left some questions in its wake.  The Austin American-Statesman is reporting the following Texas Higher Education Coordinating Board announcement:  

August 26, 2008 - AUSTIN - Based on our initial reading of the Attorney General’s opinion, it is our understanding that the Uniform Grade Point Average Calculation does not appear to apply to currently enrolled high school students. The THECB has the latitude to provide for a transition period: 

This matters to school business officials as these grade point and class ranking calculations are embedded in computerized student record keeping systems.  Making any change in the calculations can be a time consuming and expensive proposition.  Two concurrent systems just make it even more complicated.

8/26/08

12 Month Pay not Deferred Compensation

            IRS reaffirms ruling 

The use of a 12-month pay period that spans two calendar years for employees that actually only work for 9 or 10 months results in compensation earned in one year being deferred to a second year will only rarely be deferred compensation. 

The Treasury Department and IRS released Notice 2008-62 in advance of the forthcoming Code §457(f) proposed regulations to provide relief to schools as they begin their 2008/2009 school year.  This ruling was reaffirmed in a special August 25^th edition of Employee Plan News published by IRS.

8/26/08

Dual Credit Resolved

            TEA postpones regulation change  

TEA has sent out this letter: 

The 2008-09 Student Attendance Accounting Handbook was published stating that a school district could not count students in attendance for state funding in dual credit courses if those students were charged tuition, fees, or textbook costs.  Based on concerns raised by a number of school districts and a request by Senators Duncan and Shapiro, the agency has decided to delay implementation of that policy until the legislature has an opportunity to examine the issues related to dual credit.  For the 2008-2009 school year, students who participate in dual credit courses in which students pay tuition, fees, or textbook costs will be allowed to be counted in attendance for state funding purposes.   

If you have any questions, please contact either Belinda Dyer at Belinda.dyer@tea.state.tx.us or 512-475-3451 or Nicole Schuessler at Nicole.schuessler@tea.state.tx.us or 512-475-1632. 

8/22/08

Advertising on School Busses

               It’s legal and regulated by the Texas Department of Public Safety

Schools are scratching for money these days and one source that some districts are exploring is advertisements on school busses. These are pretty much the rule on transit busses but not common on school busses. The Humble ISD is reported to be one of the first.

Selling advertising space is authorized by Section 547.701(d) of the Transportation Code. Actually, the authorization is couched in terms of what the advertisement can not do and by giving the Texas Department of Public Safety the authority to regulate it.

(d) The exterior of a school bus may not bear advertising or another paid announcement directed at the public if the advertising or announcement distracts from the effectiveness of required safety warning equipment. The department shall adopt rules to implement this subsection. A school bus that violates this section or rules adopted under this section shall be placed out of service until it complies.

The DPS rules which govern the size and placement of the signs are found in the Texas Administrative Code . Districts are also required to report the advertisements to the DPS.

The content of the advertisements appear to be governed by local policy, so it’s up to the district to avoid "Chico's Bail Bonds" which is a real company which sponsored the Bad News Bears.

8/20/08

Admission, Attendance and Tuition

            TEA letter summarizes the requirements 

TEA has posted a letter summarizing the admission, attendance and tuition rules, laws and requirements.   In most respects, the letter is a repeat of information that has been posted by TEA for several years.  However, the Address Confidentiality Program (ACP) is new this year.  The ACP is intended to protect a person who is a victim of domestic violence, sexual assault, or stalking.  

It is advised that a copy of this letter be forwarded to all the campus personnel who are tasked with enrolling students for a refresher.  

The primary risk factors for school administrators are not associated with the ordinary case of a parent who lives in the attendance zone for the school registering their child, but all of the not so ordinary situations and incorrectly handled situations can have repercussions ranging from hurt feelings all the way to the court house. 

Actual family dynamics are much more complicated than the Leave it to Beaver world and always have been.  We must also recognize that cultural differences and financial stresses have produced family structures that are very different from the baby boomer generation.

Tuition and transfer students are other issues that should be handled carefully.  Some districts are attempting to increase income by accepting transfer students.  Desegregation requirements have not gone away completely.  A note near the bottom of the letter indicates that:

On June 25, 2008, the Fifth Circuit issued a judgment in favor of two intervening school districts holding that the districts are not subject to the student transfer provisions in the Civil Action No. 5281 Modified   Order or to the TEA’s regulations promulgated to enforce those provisions because the districts were desegregated before the initiation of the original litigation, were not parties to the original litigation, and had not been found to engage in discriminatory acts since their desegregation.  Samnorwood Independent     School District v. Texas Education Agency, No. 06-41347 (5th. Cir. 6/24/2008).  The TEA is currently consulting with the Office of Attorney General regarding the impact of the judgment on the agency’s implementation of the Civil Action No. 5281 Modified Order.   Until further notice from the agency, districts should continue to report transfers to the agency and could be subject to sanction for the failure to do so or for accepting transfers that are impermissible under the Modified Order.    

8/15/08

Free Lunch Helps Bottom Line

            Doing well by doing good 

Sometimes corporations like to draw attention to their good works and justify it to their stockholders by making a case that it also increases profits.  The Wall Street Journal, however, opines that that the evidence for that is not compelling.  In the case of Texas school districts getting students signed up for free or reduced price meals is a direct and positive benefit to the district.  The doing good part of this is that times are getting harder for a lot of families. 

Here’s how it works:  Texas school district income is determined by the Weighted ADA (WADA) in the district during the current school year.  WADA is calculated from the number of students attending school and the special programs in which they participate.  A student in the regular program counts as 1.0 and student in the State Compensatory Education program (SCE) adds an additional 1.2 to that number making a total of 2.2 for that student.  The WADA calculation is convoluted but, as the counts are multiplied by several factors, the commutative axiom applies and the ratio remains the same.  Each free or reduced price student earns more than double the amount of operating money that a single ADA alone earns. 

To do a demonstration of the effect, complete the State Aid Template for your district and then change only the number of SCE students and notice the result it has on total aid.  In this case you are converting regular program students to SCE.  Next change the ADA and compare the results.  Make the changes relatively small and a round number like 10 will be easier to explain. 

There is, unfortunately, a catch.  The SCE student count is determined by the highest six months of the previous Federal fiscal year which runs from October through September, so only the eligible students in August and September of 2008 will count for the 2008-2009 school year.  This is one of those things where you will have to wait a while to be rewarded for your effort. 

The reports from which the student counts are calculated are filed monthly with the Texas Department of Agriculture.  Check out the current income schedule, to discover how many of your students may be eligible. 

8/11/08

Foundation Payment Class

            2008-2009 Information available 

TEA has posted a list of the Payment Classes for the 2008-2009 school year.  If you are concerned about cash flow for the district, you should take a look at this right away as it can change from year to year and it makes a lot of difference.  Check the chart near the bottom of this article to see why it can matter so much.  A similar list for the 2007-2008 and 2006-2007 school years is also available.   The information is also available on the top line of the Summary of Finances and there is also a link to a document explaining in more detail how it works there.  You will notice that “payment class” and “payment category” are used interchangeably here. 

School district cash flow and the planning necessary to make appropriate investments and to have the needed cash on hand for payroll and to pay bills in a timely fashion is complicated.  School districts have three main sources of funds, local sources, state aid and federal funds. Each of these is divided into several different parts and each part may reach the district treasury on a different schedule and will also have different regulations governing the investment and use of the funds. 

We can put federal funds away quickly by saying that it’s almost too complicated to talk about.  Generally, federal funds are sent to the district only after they have been obligated and in an amount sufficient to pay the bills that will come due very soon.   

The property tax constitutes a vast majority of local funds and consists of two separate levies,  a Maintenance and Operations (M & O) rate and an Interest and Sinking (I & S) rate.  Property tax income also includes delinquent taxes and, in a few districts, a county equalization tax.  In over simplified form, the income attributed to the I & S rate must be credited to the I & S account and can only be used to make payments on the district’s bonded debt.  The operating income can be used for any legal purpose.   

The bulk of the property tax income is received by the district during December and January with smaller amounts from delinquent taxes being paid throughout the year.  Since the district fiscal year begins in either July or September, this means that property tax income arrives pretty much all at once in the middle of the year.  Even though recent changes in state law reduced the total local tax revenue by about a third, local tax income is still a major portion of the total funding.  The proportion, however, varies tremendously from district to district ranging from less than 10% to virtually 100%. 

Dealing with this once a year in the middle of the year income surge requires careful planning and most districts are able to invest large amounts of money as soon as taxes are paid and gradually draw these investments down to meet their obligations.  Planning for this requires that the district project cash needs into the first several months of the next fiscal year.  Some districts even borrow money to meet cash demands at times during the year when state and local income doesn’t match up with the bills. 

The fact that the fiscal year begins several months before taxes are paid is part of the reason that school districts must maintain a substantial fund balance.  While fund balance isn’t just cash in the bank – it includes money that is owed to the district and will be paid soon and does not include the money on hand for obligations that have not yet been paid and a number of other adjustments, the cash needed for the first part of the next year is a large part of the closing fund balance.  Since the proportion of the total budget that is paid from local taxes varies so widely, the ideal fund balance also varies widely.   

Foundation Aid from the state is another major portion of most districts’ income and that brings us the Payment Class.   The amount of state aid is generally inversely related to amount of local tax income per student.  As Caesar observed,

“ Gallia est omnis divisa in partis tris…,” the state payment schedule like Gaul is divided into three parts or payment classes and, like Gaul, the parts are different.  The differences are related to the portion of the total budget that is supplied by state funds. 

            Class 1: Wealth per pupil that is less than ½ the statewide average                      

            Class 2: Wealth per pupil that is between ½ and the statewide average                 

            Class 3: Wealth per pupil that is above the statewide average               

Districts  that have the smallest potential for local income per student, class 1, are paid in nearly equal amounts in most months while the half of the districts that get most of their income locally, class 3, receive a large portion of the yearly income in the first few months and nothing more until August.  Class 2 splits the difference.    

Actual payments are based on a percent of the unpaid balance to adjust for changes in allocation during the year and prior year recoveries.  Since this payment system was not updated when the local tax rates were reduced, it does not reflect the need for state aid in the early part of the year as accurately as it once did. 

This applies only to foundation aid.  The available school aid payments vary from month to month as cash is available in the state treasury, Facilities aid is paid all at once in the fall as is Technology Aid. 

8/4/08

Equalized Wealth Level (Ch. 41) Manual Updated

            2008-2009 now available 

TEA has notified all the districts that must take action under Chapter 41 of the Texas Education Code for the 2008-2009 school year.  Chapter 41 is the portion of the law which requires districts with property value per Weighted ADA exceeding $319,500 to give up a portion of their local tax collections. 

The notification letter and the Preliminary Estimate of the amount of recapture and the manual are available on the TEA State Funding website.  The manual supplies a detailed explanation of the whole process and gives detailed instructions. 

There are several things to remember about this whole process: 

The Chapter 41 determination is based on the official estimates even if a realistic estimate of actual WADA will not require the district to make any payments.

All notified districts must take the formal steps to satisfy the legal requirements even if no payment will be made.  You can’t just ignore it expecting it to go away.

Becoming Ch. 41 for the first time or dropping off the list, will not have a large impact on the district’s finances.  The Additional State Aid for Tax Reduction hold harmless will maintain the same state and local income per WADA. 

7/31/08

2008-2009 Summary of Finance Posted

            The first information for the new year  

TEA Division of State Funding has posted the first version of the 2008-2009 Summary of Finances.  

There are several things to keep in mind: 

It will be the basis for cash payments during the 2008-2009 school year but is not a reliable source of actual earnings.  Payments will be adjusted to actual earnings in September, 2009. 

The district will still need to complete the State Aid Template to estimate actual earnings for the budget and all the various notices that must be published.

It is based on attendance estimates and other information that were established the last time the legislature met and do not reflect actual attendance information since the 2005-2006 school year.  Expect it to be out of date.

This is the first iteration of this calculation and it will change several times during the school year.  It will probably change before the first payment in September.

TEA has limited authority to change the attendance estimates.  Plan your cash flow accordingly.  Expect adjustments from 2007-2008.

7/31/08

Grant Deadlines

            TEA publishes consolidated list 

TEA has posed a letter with links and the critical dates schedule for many State and Federal formula grants.   

This is going to be a tremendous help.  Print it out, highlight the grants for your district, pin it to the wall over your desk and mark off each step as it is completed.

7/31/08

Migrant and Bilingual Education

            New rules, court opinion  

Education Week is reporting that:  “The federal government has released regulations for the federal migrant education program that stiffen the requirements state administrators must follow to verify that all migrants are qualified to participate in the program.”   

Also, a Final Judgment issued on July 24^th by the United State District Court ruled that:  “…for the 2009-2010 academic year and thereafter, Defendants establish a monitoring system and establish a language program that fulfill the requirements of the Equal Education Opportunity Act, 20 U. S. C § 1703(f).” 

At first glance, these two appear to be contrary motion.  While migrant students are not necessarily LEP and vice versa, it’s often the case and the court has required Texas to do more while the federal migrant education rules may make it harder to serve some students.

7/25/08

Mileage Reimbursement Rate Increased

            Applicable to State and Federal Grants from the Texas Education Agency 

TEA has announced that the increased automobile mileage rate to match the IRS standard rate.  

Effective July 1, 2008, the automobile mileage reimbursement rate (in-state and out-of-state) for personal automobiles has increased from 50.5 cents per mile to 58.5 cents per mile or local policy, whichever is less. 

The letter goes on to explain that other allowable travel expense rates have not changed. 

7/25/08

Financial Accountability System Resource Guide Updated

            Proposed update to the accounting manual adopted 

All Texas school districts including charter schools are required to use a state adopted accounting manual.  The Commissioner of Education adopts the manual by reference in a rule.  All TEA administrative rules are available on the TEA website.  

The adopted amendment includes updates to the state compensatory education module and the accounting and auditing modules to reflect new accounting and auditing rules and standards. Part of the update includes the addition of new account codes and the deletion of some account codes. The charter school supplement was also updated to reflect these changes in accounting and auditing rules and standards.

The Resource Guide will be available on the TEA website at http://www.tea.state.tx.us/school.finance .

7/23/08

Updated 2007-2008 & 2008-2009 State Aid Template

            ASF and some other corrections 

It’s budget time and tax rate time, so check your calculations.  ESC 13 has published an updated State Aid Template for the 2007-2008 and 2008-2009 school years.  This template features updated Available School Fund (per capita) rates and some other corrections which do not impact most districts.   

As the ASF rate impacts every one, it will be a good idea to redo your calculations.  Also, be sure to check the “Greater of” number from the latest 2006-2007 Summary of Finances also as it has changed for some districts. 

Texas school district income is controlled by the number of students that actually attend school during the current school year and the programs in which they participate.  TEA will not have all the information to tell them how much they earned for the 2007-2008 school year for many more months.  For this reason, districts must make their own calculations of the amount actually earned in 2007-2008 and the projected income for 2008-2009 in order to prepare the budget and the required notices for upcoming year.

 7/16/08

Revised Summary of Finances 2006-2007 and 2007-2008

            ASF, Some “hold harmless” rates changed 

TEA has posted a letter informing districts that the 2007-2008 Summary of Finances has been updated.

The Available School Fund (ASF) rate has been reduced.  This will be exactly offset by an increase in Foundation School Fund payments to most districts.  While this may impact the timing of the delivery of state aid to the district, it should have no overall budget impact. 

The other change involves the way the derived tax collections used in the Additional State Aid for Tax Reduction (ASATR) is calculated.  ASATR sets the total M & O income for all districts and a change here may impact income for 2007-2008 and all future years.  The ASATR changes will impact some, but not all districts. 

The 2007-2008 Summary of finances is still very much estimated and this revision only reflects these specific items.  It does not include actual attendance for 2007-2008.  

The letter for 2006-2007 is similar except that only the ASATR changes have been made to the 2006-2007 Summary.  These changes will trigger additional payments or recoveries for 2006-2007.  

7/16/08

Guidance from TRS Concerning the Above Minimum Opinion

            Use the TEA published salary schedule  

The Teacher Retirement System of Texas has posted guidance concerning the attorney general’s opinion concerning the state minimum salary to be used in calculating the portion of the employer’s contribution to the retirement system. 

This posting makes it clear that the salary schedules for 2006-2007 and 2007-2008 on the TEA web site are the ones that should be used for this purpose.  Based on this posting, it appears that the only districts which may owe additional money to TRS will be those that were not using the TEA schedule. 

7/15/08

Misspent / Unearned Funds Must Be Returned

            Bookkeeping is not just prissy housekeeping 

You know this:  Virtually all money that a school gets from the government has strings attached and, whether they explicitly say so or not, it must be used exactly for the intended purpose AND you must be able to prove it long after the fact AND you are entitled to only the amount actually earned.  This applies not only to federal grants but to state grants and the spending requirements in many areas of the Foundation School Program.  

A letter from TEA announcing the Application for 2008-2009 Optional Extended Year Program (OEYP) Formula Grants makes the requirement unusually clear.  “LEAs that do not serve their required number of students, but draw down OEYP funds in excess of their allowable per-student amount will owe TEA a refund at the end of the grant.” 

Making sure that all this happens every time is a major part of most School Business Officials’ jobs and it’s not likely to make them popular with the rest of the staff.  In the area of purchases it’s a classic “No ticket, No laundry” situation with the SBO playing the role of the obstinate shop keeper and demanding to know just exactly how the proposed purchase fits into the budget and how it relates to the program associated with that budget.  From the teacher or principal’s point of view, this seems to be reluctance to do anything and meddling in their business.  

Keeping track of personnel is even more difficult as there may be nothing so obvious as the request for a case of copy paper to alert the business officer that a teacher who is being paid from a restricted source of funds has been assigned other duties on the campus.  The documentation required to justify salaries varies depending on the program. 

Unfortunately, keeping actual assignments aligned with the funding may smack of the inefficiency that schools are so often accused of when a worthwhile task can not be assigned to an employee who appears to have plenty of time to do it.   

7/14/08

Accountability Ratings Modified

            School Leaver measure modified for 2008 

School finance is not the only area where final is not exactly the last word. 

TEA has posted this letter indicating that the final 2007-2008 campus and district ratings which will be issued on August 1, 2008 will be modified to again use the School Leaver Provision that was used in 2007 so that leaver indicators (either alone or in combination) cannot be the sole cause for a lowered campus or district rating.  

The issue prompting the change is the continuing impact of the transition from a state defined dropout rate to a more rigorous National Center for Education Statistics (NCES) dropout definition. 

This change will not impact the Federal Adequate Yearly Progress (AYP) ratings.

 7/10/08

TREx Required

            Texas Records Exchange system for student transcripts   

TEA published a letter on July 9^th urging all school districts to begin using the TREx system to transfer student records between school districts and to partners with at least one college by September 1, 2008.      

From the letter:

At this point all Texas public schools and charter schools should be using TREx for the following functions:

Requesting student records from the last school attended for students who are transferring from one district to another.

Receiving and replying to requests for student records from other schools.

Sending student records and high school transcripts to requesting schools for students who are transferring.

Sending high school transcripts to colleges, universities, and community colleges upon request by the student or their parent, in keeping with the districts local policy.

7/9/08

Bus Accident Reporting

            Deadline Extended 

TEA has broadcasted the following email. 

Subject: Extension of the 2007–2008 Bus Accident Reporting Survey closing date

On June 30, 2008 an email was sent out announcing that all school districts and open-enrollment charter schools must submit a report of all bus accidents for the 2007–2008 school year to the Texas Education Agency (TEA) based on new statutory and rule requirements.  The closing date for completion of the 2007-2008 Bus Accident Reporting Survey has been extended from July 31, 2008 to August 31, 2008.  

EVERY school district and open-enrollment charter school must use the survey to submit its own individual report. If no accidents meeting the reporting requirements occurred during the school year, your school district or charter school must submit a report showing zero as the number of bus accidents.

Please ensure you read the information regarding completion of the survey prior to completing and submitting the survey.  The link to the information document which explains the bus accident reporting criteria is:  https://landry.tea.state.tx.us/TEA_Survey/bars2008/bars2008intro.htm .  At the bottom of that web page click on the “CLICK HERE TO BEGIN” link to continue to the survey and enter and submit the bus accident information.   

7/9/08

Updates to Integrated Pest Management Rules

            Advisory from extension service  

Janet A. Hurley [mailto:ja-hurley@tamu.edu] Extension Program Specialist -School IPM Southwest Technical Resource Center Texas AgriLife Extension Service has distributed the following summary of the proposed changes in the pest control rules:  

Subject: REGULATION ALERT REGULATION ALERT REGULATION ALERT 

Greetings School IPMers, 

As you are all aware last year when the Texas Legislature passed HB 2458 changes were made to the school IPM law.  In addition, the Texas Department of Agriculture also had to change or improve other sections of the rules.

On July 4, 2008 the proposed rules were posted in the Texas Register.  All new rules must go through the process of being posted to the Register and then allow 30 days for public comment.  You may either go to http://www.sos.state.tx.us/texreg/sos/index.html or a PDF version is attached to this email.  

This is your only opportunity to make comments, both positive and negative, on the Regulations, which will govern the pest control industry and school IPM for the next several years under TDA.  Please make this a priority.  

Written comments on the proposal may be submitted to Jimmy Bush, Assistant Commissioner for Pesticide Programs, Texas Department of Agriculture, P.O. Box 12847, Austin, Texas 78711.  Written comments must be received no later than 30 days from the date of publication of the proposed amendments in the Texas Register, which means your response must be received by August 1, 2008 if you want to be heard.  Note that emails, oral comments, and phone calls will likely not receive the same weight as a written letter submitted via this process. 

Below are some sections that you should pay close attention to. Since most of you receive this email in plain text format, we could not send our wording in a different color. Be sure to read slowly.  

§7.125.Examinations.  - Some requirements necessary to take an examination have been changed.  Under the changed regulations, everyone (including those with college degrees in biological sciences and related fields) will have to attend the 6-hour applicator-training course prior to examination.  

 3. COMPLIANCE AND ENFORCEMENT - This section pertains to posting and school IPM.  There is some dialogue about the increase in cost to schools to obtain training. 

§7.144.Pest Control Use Records.  - Changes the recordkeeping requirement to keep all records from 2 years to 5 years - needed to comply with the new inspection requirements (and the Open Records Act).  

§7.146.Pest Control Sign.  §7.147.Consumer Information Sheet.  Both of these sections have changes in how and where to post.  You will also notice the new requirement making it mandatory for schools to post all outdoor pesticide applications.  TDA also added IPM Coordinator to the wording and clarified there is no need to post for pre-construction termite jobs (in unoccupied buildings).  

§7.149.Inspections.  TDA added schools to this section - along with risk based criteria.  

§7.150.Schools - This section contains some of the most extensive changes in SPCS rules.  If you read no other sections, read this one.  

All districts will be required to report the identity and contact information for school IPM coordinators to the state within 90 days of appointment.  IPMCs will be required to obtain their mandatory training within 6 months (instead of the old 12 months) of appointment. In addition, continuing education (6 hours at least once every three years) will be required for all IPMCs. 

IPM Coordinators will be required to give their authorization to the PCO for use of Yellow category products (previously, approval by the IPMC was required only for Red category products).  

(d) Pesticide Use In School Districts 

(4) Students and personnel non essential to the application shall not be allowed in area(s) where pesticides are applied at the time of application or during the re-entry time limits in a building or school grounds except as otherwise stated in this section.  -  

We note some inconsistency in wording between this section and the sections on yellow and red category products (i.e., non-essential personnel vs. students).  However, note the requirements for schools go beyond posting after an application.  In addition, schools are to be responsible for keeping "all personnel non-essential to the application" out of treated areas.  

(e) Pesticide category and application restrictions:  

A significant passage indicates that "pesticide applications may be made on district property only after the use of non-chemical pest management strategies have been considered".  Not clear how this will be enforced or interpreted.  If clarity of interpretation is important to you, this might interest you.  

Posting for outdoor applications will be required 12 hours in advance of an application (previously no posting either before or after application was required).   

(1) Green Category Pesticides.  - This section has gone through several revisions, yet still results in exclusion of several pesticides previously considered green. This is one of the major tweaks made by the TDA and deserves your close inspection and comment. 

(A) Green category pesticides are defined as "...general use pesticides which may have a Caution signal word or no signal word (EPA toxicity categories III and IV) that's [sic] active ingredients are derived from borates; silica gels; diatomaceous earth; nonvolatile insect and rodent baits in tamper resistant containers; pesticidal soaps; gels, paste or baits for crack and crevice treatment only; microbe-based pesticides; pesticides made with essential oils but without synthetic pyrethroids, with 5% synergists or less."  

Previously the green category included: Inorganic pesticides containing boric acid, disodium octoborate tetrahydrate, silica gel or diatomaceous earth., Insect growth regulators, Insect and rodent baits in tamper-resistant containers, or for crack-and-crevice use only, Microbe-based insecticide, Botanical insecticides (not including synthetic pyrethroids) containing no more than 5% synergist, Biological (living) control agents, Pesticidal soap and natural and synthetic horticultural oils.  Note that the new definition has somewhat different wording regarding inorganic pesticides, does not include IGRs, and wording that seems to exclude pyrethrins and some other botanical insecticides (botanicals that are not essential oils).  It has also been debated whether 25b (exempt) pesticides will be allowed under the new rules, since 25b products are exempt from signal word requirements and hence are not technically assigned a toxicity category by EPA.  If you think it important that schools retain the right to use 25b products (e.g., Ecosmart products, others), this is the place to make that sentiment known. 

(2) Yellow Category Pesticides. 

(C) Restrictions:  The wording for this section is similar to the old wording, but it gives more direction to how, when and where you will use Yellow and Red products.  Play close attention to the wording and then think how you are doing pest control now.  

iii) treated areas must be clearly marked and secured using a locking device, a fence or other practical barrier or monitored to keep individuals out of the secured area until the allowed re-entry time – think teachers, custodians, grounds crew, etc.    

 §7.155.Incidental Use For Schools.  - Only Green Category products will be permitted for incidental uses.  This will severely limit the number of products that can be used against wasps, hornets, and fire ants-particularly if 25b pesticides and pyrethrins are excluded from the green category. 

These are just a few things to note in the new rules that will have an impact on schools and pest management professionals servicing them.  There may be other things that are even more important to you and your operations, than the items we have highlighted.  For this reason, we encourage you to read the entire proposed regulations, noting that all changes are noted by crossing out or underlining.  If you have additional questions, please contact one of us, myself or Dr. Merchant at m-merchant@tamu.edu.  We will do our best to explain the rules and implications, as we see them.   

Have a great week, and look for more in School Pest News due out next week 

For more information about school IPM, go to http://schoolipm.tamu.edu   

To join or leave this listserv, reply to this e-mail with SUBSCRIBE OR UNSUBSCRIBE in the subject heading.

Janet Hurley, MPA
Extension Program Specialist -School IPM Southwest Technical Resource Center Texas AgriLife Extension Service 17360 Coit Road Dallas, TX 75252
972-952-9213 or 877-747-6872
ja-hurley@tamu.edu

http://schoolipm.tamu.edu 

7/8/08

            Attorney General’s opinion defines state minimum 

The Attorney General has determined that the state minimum salary to be used in calculating a district’s obligation to pay the employer’s share due to the Teacher Retirement System of Texas is the state Minimum Salary Schedule published by TEA. 

The immediate issue was several mandates to increase actual teacher salaries which were not reflected in the minimum salary schedule.  The Attorney General determined that, even though these were state mandated salaries, they did not constitute the minimum salary reflected in the statute.  

The Commissioner of Education’s request and the opinion explain all the details.  This obligation for school districts rather than the state to pay the employer’s share of a portion of some employees’ salary is found in Section 825.405 of the Government Code. 

This requirement originated in 1984 to address the concern that the state was subsidizing the salaries that some high wealth districts were able to pay (even at low tax rates) which far exceeded salaries paid in lower wealth districts.  The solution was to require the district to pay the State’s share of the required contribution to the Teacher Retirement System on salaries that exceeded the state minimum salary multiplied by the Cost of Education Index.

By now, much of this requirement is seriously obsolete as it predates the Equalized Wealth Level which is intended to neutralize the wealth advantage some districts had.  This is found in Chapter 41 of the Texas Education Code.  The Cost of Education Index is a factor used in calculating state aid for school districts that is intended to compensate for local differences in the cost of operating a school but which has not been updated since 1990 and the requirement for updating the index was repealed in 1997.  

Districts in which the tax rate exceeded 125% of the state average were excused from this payment, but the maximum tax rate allowed is currently only 17% higher than the compressed tax for most districts requiring virtually all districts to make these payments to TRS.  Tax rates were compressed in the 2006-2007 school year and the maximum allowable rate was lowered at the same time.  This greatly reduced the range in tax rates state wide. 

The legislature has required salary increases several times by mechanisms other than increasing the minimum salary schedule.  Most recently, H.B 1, for example, required a $2,500 increase in the actual salary of all those employees who also have a minimum salary.  As the minimum salary has not increased as to keep pace with these other salary increases, the districts’ share of the employers contribution has been increased by a state mandated salary increase. 

In addition, the state minimum salary schedule has been radically altered over the years and minimum salaries for all employees other than teachers, librarians, counselors and nurses were eliminated in 1996.  The payment to TRS for these employees is calculated from the current minimum salary on the state schedule in effect on January 1, 1995.  The actual salaries of these employees have generally increased to keep pace with the increases in the minimum salary and required salary increases for other employees.  While the state pays the employers’ share for much of the salary increase for those employees who still on the state minimum salary schedule, the districts are liable for all of the increase for those employees who no longer have a minimum salary.

7/3/08

PSF Bond Guarantee Running Out

            Getting national attention 

The guarantee capacity of the Texas Permanent School Fund ("PSF") Bond Guarantee Fund is expected to be reached in the next few months. The Bond Buyer, a national publication, carried an article on July 1^st In Texas, More Bad Insurance News outlining the complications and cost to Texas school districts if this credit enhancement is not available to them.  The article also points out that the weakness in the bond insurance industry may make the lack of the PSF guarantee even more expensive. 

During the last session the Texas Legislature provided a mechanism for the State Board of Education to increase the State law limit from 250% to 500% of the cost value of the PSF.  Last year the Texas Education Agency requested the United States Department of Treasury ("Treasury") provide for a similar increase in the applicable Treasury Regulations.   

The requested increase in guarantee capacity was supported by separate letters to Treasury sent by the Municipal Advisory Council of Texas, the Securities Industry and Financial Markets Association, Governor Perry, and a joint letter from all 32 Texas members of the United States House of Representatives.  The request is still pending with Treasury and no final decision has been made on whether a change will be forthcoming in the current regulation project concerning the applicable Treasury Regulations.  

Members of the Texas delegation in Washington including our two United States Senators supported the effort to get an increase in the guarantee capacity of the PSF.  Some Texans have asked what the beneficiaries of the PSF Bond Guarantee Program can do to help this effort.  The most appropriate thing to do at this time is to thank our Congressional Delegation in Washington for their support and let them know that their help on this very important issue is appreciated. 
                                                       
                                                             Sample Letter

U.S. House Directory, Senate Directory 

7/3/08

12 Month Compensation Clarified

            Interim guidance from the IRS  

IRS rules under discussion had proposed that the summer checks that teachers receive might be treated as deferred compensation.  This would have greatly complicated school payrolls.  Bottom line:  Schools won’t have to do that. 

The IRS has posted an Interim Guidance document indicating that, in most cases, teachers’ earnings paid over a twelve month period do not involve deferred compensation.   

The introductory portion of the document reads:  

Interim Guidance on the Application of § 457(f) to Certain Recurring Part-Year Compensation 

Notice 2008-62

This notice describes a rule that the Treasury Department and the Internal Revenue Service (IRS) anticipate will be included in regulations to be proposed under § 457(f) of the Internal Revenue Code. 

The regulations to be proposed are expected to address certain types of arrangements involving recurring part-year compensation, including common arrangements involving public school employees who provide services during a 10-month school year and elect to be paid ratably over 12 months. It is expected that the regulations would provide that if certain conditions described below are satisfied, §457(f) would not apply to such arrangements. It is also expected that a conforming change will be proposed for regulations under § 409A, so that § 409A also will not apply to such arrangements if such conditions are met.  

Section II of this notice describes the rule expected to be included in the proposed regulations. Taxpayers may immediately rely on the rule described in Section II of this notice. 

Be sure to read the whole thing as there are some time frame and total compensation limits.  It is also possible that some of this could still change, so watch for the final rules to be adopted.

6/30/08

Expenditure Target Template

            ESC 12 makes it easier 

Texas Education Code, § 44.011 and an Executive Order from the governor require the TEA to develop expenditure targets for all of the school districts in the state.  These targets are expressed as a percentage of the total budget devoted to several major areas such as instruction and administration.   

If the board adopts a budget that exceeds the target percentage significantly, the board must adopt a resolution acknowledging that they are doing so.  More detailed information about the expenditure targets is available on the TEA website.   

Notice that the 2008-2009 district reports on the website are based on TEA’s projection of the district budget, not the actual budgets and that the district must calculate the actual report from.  The ESC 12 template is considerably easier to use than the ones on the TEA website.

6/26/08

Chapter 41 Final for 2006-2007

            Can now settle up with partner districts 

TEA has updated the Chapter 41 report for the 2006-2007 school year.  Scroll down to the CHAPTER 41 COST OF RECAPTURE REPORT section and enter the district number to see these reports.  Like state aid for all districts, these calculations are based on the final 2006-2007 ADA and the 2006-2007 audited tax collections.  Up to this time, payments have been made on estimated information.  This letter explains the update in more detail. 

Chapter 41 is the portion of the Texas Education Code which requires some high property value district to share a portion of their tax revenue with either the state or another district.  The TEA website has more information about what is required.  

If the district transferred money to partner school district instead of the state, the amount paid to that district will likely need to be adjusted.  If the number of WADA purchased is different, this will trigger an adjustment in the amount of state aid due to the partner. 

6/24/08

Employees' Text Messages are Private

Even when transmitted on devices their companies pay for  

Now this is getting really complicated.  Information Week carried an article on June 19^th exploring the ins and outs of the issue.  

The 9th U.S. Circuit Court of Appeals ruled Wednesday in favor of a police officer and others who claimed that the city of Ontario, Calif., violated their Fourth Amendment rights, which provide citizens with a reasonable expectation of privacy, by reading the contents of their text messages. It also ruled that the company providing the department's paging service falls under the Stored Communications Act. That means carriers cannot reveal the contents of SMS or text messages without authorization from the end user -- even if the user is an employee.  

Some of the comments which appear to come from industry insiders disagree with the premise that all text messages are private, but the finding that some messages may be private means that the employer can not automatically assume that they are entitled to see all text messages and access may depend on whether the messages were routed through a company server or an outside service such as a phone company.  USA Today also reported on the ruling and this article has links to even more discussion.  

Texas has comprehensive laws and regulations involving both the retention and release of all sorts of records by both the state and local governments.  The Records Management Publications webpage maintained by the Texas State Library and Archives Commission makes a large number of documents relating to records management available.  The Model Email Policy for State Agencies contains the following statement: 

Personal use of e-mail is a privilege, not a right. Abuse of the privilege may result in disciplinary action. All e-mail is stored along with the source and destination. Management has the ability and right to view employees' e-mail. E-mail messages are the property of the agency and therefore the taxpayers of the State of Texas. Thus, they are subject to the requirements of the Texas Public Information Act and the laws applicable to State records retention. 

The difference between a text message and an email is not immediately obvious, but this statement, when applied to text messages, appears to be in conflict with the court ruling.  As with so many things surrounding employee privacy and employer’s obligation to know and the public right to access, school administrators need to tread carefully and seek competent advice before making decisions in individual cases. 

The use of school computers and telephones for personal purposes is always a fine line.  The most conservative stance is to say, “Never, ever for any reason what so ever.  It’s stealing government resources for personal use.”  This, however, is not necessarily good personnel management.  Forbidding an employee to take a return call from the plumber or a doctor, for example, could increase absences from work when people stay home all day to wait for that five minute call and just a few days absence can cost the district more than an entire year’s phone bill.  It’s hard to put a number on employee morale, but it’s real. 

On the other hand, it’s definitely not permissible for an employee to run a personal business from school and spend hours every day on the phone and personal email.  There is also the matter of the content of the personal messages and text messages could easily be the vehicle for improper contact with students making it a mater of great concern to the employer.

6/18/08

Bond Insurance Woes Continue

            MBIA finances unsettled  

Since the Permanent School Fund bond guarantee is no longer automatically available for all school district bonds, private bond insurance has become increasingly important to Texas school districts as it reduces the cost of borrowing by making the bonds more attractive in the market as anything that increases the confidence that the bonds will be paid on time will result in a lower interest rate.  Anything that increases the perception of risk will, conversely, increase the interest rate that the district must pay. 

The New York Times reported on June 18^th that MBIA, a large bond insurer has promised the New York state regulators that it would shore up the capital position of the bond insurance unit.  The ability of the regulators to enforce this, however, is limited by $137 billion in swaps, which are privately traded insurance contracts that let people bet on companies’ financial health. Most of these contracts stipulate that if MBIA’s bond insurance unit becomes insolvent or is taken over by state regulators, buyers can demand payment immediately.  The concern is that these demands could take precedence over payments that might be due to bond holders.  

6/17/08

Release of Criminal History Information

            Summary information is public, individual information is not 

The Austin American Statesman reported on June 17^th that the Attorney General has ruled that, “…the Austin school district must release summary information on employees found to have criminal histories but clarified that it cannot release information connecting crimes to individuals.”  As this is an extremely sensitive issue, school officials should be very cautious and seek legal advice before releasing criminal history information. 

This is an important ruling and a difficult one for Texas school districts as the exact items of personal information that must be released and those which must not be disclosed is at the very least complicated.  Government Code Section 552.352(a), states: “A person commits an offense if the person distributes information considered confidential under the terms of this chapter.” A violation under section 552.352 is a misdemeanor constituting official misconduct.”   

The Attorney General has published a public information handbook.  This manual is 288 pages long and details what must be made public and what must not be made public.  A large portion of the book is devoted to what must not be disclosed.  The confounding problem is that “…Section 552.101 of the Government Code excepts from required public disclosure information considered to be confidential by law, either constitutional, statutory, or by judicial decision.”   

This includes Federal laws as well as Texas statutes and common law.  “Section 552.101 also excepts from required public disclosure information held confidential under case law.  …And applies to information when its disclosure would constitute the common law tort of invasion of privacy through the disclosure of private facts. To be within this common law tort, the information must (1) contain highly intimate or embarrassing facts.”  Information that is currently or can reasonably be expected to be the subject of either litigation or administrative appeal is also not to be disclosed.  It’s not hard to imagine that a person’s criminal history would be highly intimate or embarrassing or subject to appeal.  

When a governmental body receives a written request for information the governmental body wishes to withhold, it must seek an attorney general decision within ten business days of its receipt of the request and state the exceptions to disclosure that it believes are applicable unless the privacy of the information has already been determined.  It is well established, for example, that some items in a school employee’s personnel record such as the Social Security Number and personnel evaluations are not to be disclosed, but many others depend on particular circumstances.  The Attorney General has issued over eight thousand such opinions since January 1, 2008, indicating that ambiguous situations occur frequently. 

The response to Austin ISD original request can be found on the Attorney General’s website. 

6/16/08

Explaining the Budget Crunch

            Communication is always the hardest part of school finance 

In a column in the June 15^th Ft. Worth Star Telegram entitled Old ideas won't help districts adjust budgets, Mike Norman makes a plea for new ideas in making school budgets fit within the available revenue.  The main point of his article is reflected in the title – the traditional bromides of cut waste, fat and too many administrators have already been done.  Spending one time income and savings just put off this year’s problem at the expense of a bigger problem next year.  

In the San Antonio Express-News, Northside ISD Superintendent John Folks explains that the public seems to often believe that schools got a lot more money than they did in 2005.  He discusses succinctly how total is actually frozen and increases in appraised values benefit the state and not the district. 

Texas Monthly’s Senior Executive Editor, Paul Burka reported from the U. T. San Antonio Superintendent’s conference on June 13^th.  The blog is devoted to Texas politics, and he ruminates about who might vote for whom in the elections.  When he turned to education he delivered this stinging criticism: 

To continue with the obvious: The leadership of the state cares more about tax cuts than public education. They have set up a financing system that is designed to strangle education: All of the new money is dedicated funds, like the high school initiative, and there is nothing to cover inflation in the cost of health insurance, utilities, and fuel. As a result, school districts are having to dip into their reserves. Education is no longer funded by formulas; instead it’s “hold-harmless.” 

6/12/08

Truth-In-Taxation Manual Released

            On the Comptroller’s website 

The 2008 Truth-In-Taxation guide for school districts has been posted on the comptroller’s website.  There are several important things about property taxation that school personnel should remember: 

The rate setting limits and notices are different for school districts.  A series of seminars is being held at the ESCs to assist taxing jurisdictions the rate setting procedures and preparing the required notices.  Notice that there are two sessions each day on the schedule.  The afternoon schedule is for school districts.

Completing the notices for a school district requires that the district prepare a good faith estimate of actual 2007-2008 state aid and projected aid for 2008-2009.  The State Aid Template available from ESC 13 will assist districts in making these estimates.  The information necessary to accurately make these estimates is not usually available to the appraisal district.

Many school districts will be receiving tax rolls from more than one appraisal district this year but only one notice and effective rate and rollback rate calculation will be made. 

6/10/08

Criminal History for Contract Employees

            TEA posts proposed rules 

The Texas Education Code §22.0834 mandated that criminal history reports be obtained for certain contract employees.  The commissioner of education has proposed rules that would clarify when this will be necessary.  Significantly, the proposed rules would exempt sports officials who would not be alone with students from this requirement.  

(7)      Direct contact with students--The contact that results from activities that provide substantial opportunity for verbal or physical interaction with students that is not supervised by a certified educator or other professional district employee. Contact with students that results from services that do not provide the opportunity for unsupervised interaction with an individual student, such as addressing an assembly, officiating a sports contest, or judging an extracurricular event, is not, by itself, direct contact with students. However, direct contact with students does result from any activity that provides the opportunity for unsupervised contact with students, such as, without limitation, the provision of individualized coaching, tutoring, or other services. 

The TASB website has additional helpful information about criminal record checks.

6/9/08

A Cautionary Tale

            Sometimes doing “the right thing” conflicts with survival 

The Lewiston, Main, Sun Journal featured a story on June 7^th, recounting how 130 year old Sheldon Jackson College in Sitka, Alaska, was forced to close by financial difficulties.  The private college began a missionary outreach to Alaska natives and, even though it closed a year ago, is still on the U.S News & World Report list of America’s Best Colleges.   

The story quotes trustee and former state Sen. Arliss Sturgulewski:  ‘"How can I say this kindly?" he said. "Very poor management and business practices coupled with a very high commitment to education and personal attention to students meant that people gave everything to educate students but in so doing they also gave away the school."’ 

The news recently has been filled with stories describing how, in one way or another, Texas school districts are struggling to make a viable budget for next year.  The Damon district in Fort Bend County is counting on a tax rate election to bring in enough money for this very small district to hang on as is the Humble ISD.  If the election fails, Damon will likely consolidate with a neighboring district and Humble will have to begin cutting programs and staff.  The Cedar Hill ISD is discussing an election to avoid program cuts in another year while the Bryan ISD is discussing staff reductions and only cleaning the buildings every other day to avoid using fund balance this year. 

These are not easy discussions for any school board and it’s rare that the school business officers can find painless magic cuts in expenditures that will permanently solve the problem.  The current school funding law fixes a district’s total income at an amount per Weighted ADA based on actual income in 2005-2006 or an old law amount for 2006-2007 plus an adjustment for the 2006-2007 state salary increase and some new programs.  This amount will not change until the law is changed by the legislature.   

Increased property tax collections due to rising appraisals are offset by decreases in state aid.  Increasing enrollment gives growing districts an opportunity to water the soup by serving more children with a smaller increase in staff.  Districts with stable or declining enrollments are left with absolute budget cuts.  Since about 80% of a typical school district budget is salaries, budget reductions usually require staffing cuts.  

A tax rate election will net a district a maximum of $415 per WADA in most cases.  WADA is a combination of the number of students attending school and adjustments for programs and several other factors which make this number larger than enrollment.  While there is a sizable variation between districts, this translates into an average increase in income of less than $600 per enrolled student. 

Income, then, is fixed within a narrow range, but the costs of operating a school district have continued to increase.  Fuel, food and utilities are obviously more expensive and there is considerable pressure to increase teacher salaries.  In order to avoid the fate of Sheldon Jackson College, school administrators and school boards will have to take a hard look at the future.  Unfortunately, survival will in some cases, force decisions that no one likes and are not “the right thing” for either students or the school employees. 

6-6-08

2007-2008 Tax Collection Survey

            Actual collections matter a lot 

TEA is requesting total tax collection information for the 2007-2008 school year.  The information is reported in the TEASE system and the actual survey can be accessed only by authorized account holders. 

This is not just nice to know information but will impact the settle up for the 2007-2008 school year and will persist until the spring of 2009.  Accurate reporting of all current and delinquent tax collections including an estimate of the taxes that will be collected through the end of the fiscal year is essential. 

TEA has broadcasted the following letter:

The Tax Information Survey is now open for reporting the amount of taxes that have been collected to date and any additional taxes estimated to be collected through the end of the district fiscal year.  This module can be accessed via the Foundation School Program (FSP) Application within the TEA Secure Environment (TEASE):

https://seguin.tea.state.tx.us/apps/logon.asp

Because of the potential for districts to be on an alternate fiscal calendar, the instructions listed below should be followed based on the situation for your specific district:

In addition to providing us your district’s estimate of tax collections, we are asking that you verify your district’s adopted maintenance and operations (M&O) and interest and sinking fund (I&S) tax rates for the 2007 tax year. Please note that to better estimate the amount of near-final settle-up for the 2007–08 school year, we are requesting that this survey be completed in a timely manner. The survey will close on August 1, 2008.

If you have any questions, please do not hesitate to contact a state funding consultant at (512) 463-9238.

Sincerely, 

Helen Daniels, Director
State Funding

6/10/08

Criminal History for Contract Employees

            TEA posts proposed rules 

The Texas Education Code §22.0834 mandated that criminal history reports be obtained for certain contract employees.  The commissioner of education has proposed rules that would clarify when this will be necessary.  Significantly, the proposed rules would exempt sports officials who would not be alone with students from this requirement.  

(7)      Direct contact with students--The contact that results from activities that provide substantial opportunity for verbal or physical interaction with students that is not supervised by a certified educator or other professional district employee. Contact with students that results from services that do not provide the opportunity for unsupervised interaction with an individual student, such as addressing an assembly, officiating a sports contest, or judging an extracurricular event, is not, by itself, direct contact with students. However, direct contact with students does result from any activity that provides the opportunity for unsupervised contact with students, such as, without limitation, the provision of individualized coaching, tutoring, or other services. 

The TASB website has additional helpful information about criminal record checks.

6/6/08

Updates to 2006-2007 “Final” Summary of Finances

            Remember, nothing is ever final  

The TEA Division of State Funding has posted this letter explaining the latest changes to the 2006-2007 Summary of Finances.  These latest changes involve three particular conditions and do not apply to most districts.  Everyone needs to check however, they may impact the Additional State Aid for Tax Reduction amount per WADA which will also impact the district income in 2007-2008 and 2008-2009. 

The first change involves the recalculation of local 2006-2007 calculations at the 2005-2006 tax rate used in the S2 amount per WADA calculation.  The revised calculation method should more accurately reflect the impact of Lease-Purchase IFAs and TIF payments on the recalculated collection.   

Just in case you are curious, a lease-purchase IFA is facilities aid under Chapter 46 of the Texas Education Code which was not financed with bonds.  TIF stands for Tax Increment Financing and generally applies to Reinvestment Zones created under Chapter 311 of the Tax Code,  the Property Redevelopment and Tax Abatement Act authorized by Chapter 312 and Texas Economic Development Act in Chapter 313. 

The next two changes involve the sale of WADA to a Chapter 41 District which involves the transfer of money from a high wealth district to a lower wealth district.  When this occurs the benefit to the lower wealth district is the difference between the amount of money the lower wealth district receives and an offsetting reduction in state aid. 

If the district sold WADA in 2006-2007, the reduction in state aid has been recalculated using the most recent data for 2006-2007.  The letter cautions, however, that number of WADA sold has not yet been adjusted to reflect the final obligation of the higher wealth district and may change again. 

The last change involves districts that sold WADA during the 2005-2006 school year.  The S2 calculation mentioned above involves a calculation of the profit from the 2005-2006 sale as if it had occurred again in 2006-2007.  In some cases, this profit had been over stated in earlier versions of the Additional State Aid for Tax Reduction calculation.  

6/4/08

403(b) Opinion Released

            Answer:  It depends…. 

Changes in the Federal tax regulations have introduced a new set of concerns regarding 403(b) plans offered by school districts.  ASBO has a webpage devoted to this problem.  Part of the complication is the way these new regulations intersect with state laws.   

The Texas Attorney General was asked several questions about the use of third party administrators to manage these plans.  The opinion came back a tentative yes with, “…although a court may find a violation in particular circumstances.”   

S U M M A R Y

Whether an educational institution violates article 6228a-5, section 9(a)(4), (6)-(7) of the Revised Civil Statutes by contracting with a third-party administrator that is affiliated with a company that sells qualified 403(b) investment products to the educational institution's employees is a question requiring the resolution of facts. An educational institution may provide a third-party administrator that is affiliated with a company offering qualified 403(b) investment products to employees of the educational institution with exclusive access to employees' financial information without violating section 9(a)(5), although a court may find a violation in particular circumstances. 

6/3/08

New State Aid Template Posted

            Revision 4 from ESC 13

Omar Garcia at ESC 13 has posted an updated State Aid Template for the 2007-2008 and 2008-2009 school years.  Significantly, this revision includes the calculation of the effective tax rate and the required notices.

We are very much in catch up mode, however.  As of early today, the template still carries a link to the 2007 Truth in Taxation documents with suggestions about how to use them for 2008.  The comptroller has now posted the actual 2008 Truth in Taxation book which should be used instead.

TEA has also made changes to the 2006-2007 Summary of Finances which are not yet reflected in the 2007-2008 summary.  Be sure to use the “Greater Of” number from the 2006-2007 summary.  For districts that sold WADA in 2005-2006, the number may still not be correct in some cases and a letter explaining the changes has not been posted at this time.

As we said last time, be sure to use the best available data for the 2007-2008 and your best estimates for 2008-2009 and do your own calculation.  The TEA data for 2007-2008 is at best stale and an estimate and you know, for example, what your actual attendance and special program student counts were.  The district will ultimately be paid for the actual counts. 

5/30/08

Required Budget WEB Posting

            Budget adoption ceremonies 

School’s out so it’s time to get really busy in the business office and get a budget in place for the upcoming year while, at the same time, winding up all the loose ends of this year.  There are several related actions that the district staff and the board must accomplish. 

In addition to actually preparing a budget, § 44.004 of the Texas Education Code contains the directions for the “NOTICE OF PUBLIC MEETING TO DISCUSS BUDGET AND PROPOSED TAX RATE” which must be published at least ten days and not more than thirty days before the board meeting at which the new budget and tax rate hearing will be held.  The notice contains information about both the budget and the tax rate and revenues. 

In order to calculate the revenues, the district will need to complete the state aid template which is found on the ESC 13 website.  This template contains a tab which supplies some of the information needed for the notice.  This calculation, in turn, depends on calculations that are made on a form supplied by the Texas Comptroller.  As of May 30^th, the forms for the 2008 tax year were not yet available and the template suggests using the 2007 forms with appropriate adjustments for this purpose.  

Since TEA will not make actual calculations for the 2007-2008 school year before September, the district will need to use the state aid template to make an estimate of 2007-2008 actual earnings as well as an estimate of expected income for the 2008-2009 school year. 

There is no option for separating the budget and tax rate hearings.  The tax rate portion of the notice, however, can be prepared using certified estimates if the actual tax roll has not been certified by the appraisal districts.  The rate can be adopted at a later meeting without another hearing as long as it is no higher than the rate proposed. 

§ 44.0041 of the Texas Education Code requires that at the same time as the notice of the public hearing is published, the school district post the budget summary on the school's Internet Website.  Woody Brewton, Region 12, has developed a template to assist districts in meeting this posting requirement.  

5/27/08

Safety in the News

            Earthquakes in China and Safety Audits in Texas 

The collapse of many schools in the Chinese earthquakes has been the theme of several articles in the New York Times.  Turning Schools from Death Traps Into Havens is the May 27^th edition and this article contains links to several other articles.  The overall conclusion is that school buildings can easily be made safer.  The hazard is that short term expediency and immediate cost savings can be lead to disastrous results when the unexpected occurs. 

Texas has been working to improve school buildings for many years now and a set of building standards can be found on the TEA website.  Most of the text of the standards addresses making the building suitable for the planned purpose and a few short paragraphs cover the construction quality issue by requiring that they must comply with the building codes and be inspected by an independent inspector during construction.  

Following these best practice construction codes and scrupulously keeping up with the health and fire code compliance is probably the best way to demonstrate that you district is doing a good job of preparing for natural disasters.   

Texas schools are also required to plan for human dangers as well and to conduct a safety audit and report the results Texas School Safety Center.  The Texas Attorney General’s website has a page devoted to school safety with links to school safety resources as well as information about the safety audit. 

5/23/08

New Tax Survey from TEA

            Implements adjustments for changes in property tax exemptions  

House Bill 828  requires the commissioner to adjust the amount of a district’s local maintenance and operations (M&O) revenue in determining its state aid if, in the 2007 tax year or later, the district adopts a new local option homestead property tax exemption, eliminates an exemption that was in effect in the 2005 or 2006 tax year, changes the amount of the exemption, grants a new tax abatement, ends an abatement that was in effect for the 2005 or 2006 tax year, agrees to deposit taxes into a tax increment fund under a new reinvestment zone financing plan, or ceases to deposit taxes into a fund created under a plan that was in effect for the 2005 or 2006 tax year.

TEA has distributed the following letter.  Notice that it contains a link to a survey which is due by July 1^st. 

May 22, 2008 

We are in the process of implementing the provisions of House Bill 828 that was passed by the 80^th Texas Legislature.  This bill authorizes the Texas Education Agency (TEA) to adjust funding for districts under certain circumstances.  In order to comply with the law, we are asking you to complete a tax information survey online at the link provided below.  In this survey, we ask about changes in local optional homestead exemptions, about changes in payments made to Tax Increment Fund (TIF), as authorized in Chapter 311 of the Property Tax Code, and changes in abatements, as authorized by Chapter 312 of the Property Tax Code. 

In order to determine whether your district is eligible for funding adjustments prior to the near-final settle-up period for the 2007-08 school year, we are requesting that this survey be completed in a timely manner.  Upon completion of the survey be sure to click on the submit button at the bottom of the form.  Please complete the survey located at http://landry.tea.state.tx.us/tea_survey/Tax%20Information%20Survey08/Tax%20Information%20Survey%2008.htm no later than July 1, 2008. 

Because of the potential for districts to be on an alternate fiscal calendar, the instructions listed below should be followed based on the situation for your specific district:

If the school district fiscal year began September 1, 2007 and will end August 31, 2008 (the traditional fiscal year), report amounts for the period September 1, 2007 through August 31, 2008.  

If the school district fiscal year began July 1, 2007 and will end June 30, 2008 (alternate year), report amounts for the period July 1, 2007 through June 30, 2008.  

If the school district fiscal year began September 1, 2007 but will end June 30, 2008 (i.e., your district is in the process of converting fiscal years in 2007–08), report amounts for the period September 1, 2007 through August 31, 2008 (the traditional year basis).  

It is important to enter the time and date in the survey in case the data is entered multiple times we can record the most recent entry. 

If you have any questions, please do not hesitate to contact Al Johnson in the Division of State Funding at (512) 463-9238.

Sincerely, 

Helen Daniels, Director
State Funding Division 

5/20/08

Truth-in-Taxation Seminar Schedule

            Schools still need to be concerned 

The comptroller has released the schedule for the Truth-in-Taxation Seminars for 2008. 

They will be held at the ESCs beginning June 11^th.  Notice that there are two different presentations.  The school presentations will always be 1:30 to 3:30.   

The morning presentation is for all the other sorts of taxing entities.  Don’t go to that, it will only confuse you.  There are calculations to be made and forms to fill out, but expect that the rollback rate for most districts will be $1.04, the same as last year. 

Allowing six cents in the middle band of Tier II did NOT change the rollback calculations.

4/28/08

2006-2007 & 2007-2008 Summary of Finances Updated

            Remember, Final isn’t Final 

The TEA Division of State Funding has once again updated the Summary of Finances for 2006-2007 and for 2007-2008.  This time there is a letter explaining the changes for 2006-2007. 

Of particular interest are three items relating to the calculation of Additional State Aid for Tax Reduction (ASATR) and the charge for the Sale of Weighted ADA. 

None of the calculations involving Chapter 41 are final at this time.  They are expected to be completed in June, 2008.  If a district sold WADA in 2006-2007, the number of WADA sold and thus the charge for the sale may be adjusted later on. 

The gain from the sale of WADA in 2005-2006 is part of the ASATR calculation and this calculation is also not final at this time.  The letter warns that, if the district did not keep all of the gain from the sale, “It is very likely that the final gains in S2 and S3 will be lower than the current numbers.” 

The tax collection calculation used in the S3 ASATR calculation has also been revised to reflect the average tax collection rate for the past three years. 

Payment of any amount owed the district is promised for May and recoveries of overpayments are scheduled for May as well.  Districts that are involved in the Chapter 41 transactions should be particularly aware that a lower final gain in S2 and S3 may result in a recovery of state funds in June.

4/23/08

The Ratings Game

            New York Times discusses how Mortgage Backed Securities were rated AAA 

This is a bit off the subject of school finance, but it is related.  The NYT has previewed an article entitled Triple-A Failure which will be published in the April 27^th New York Times Magazine. 

The reporter was shown the step by step process by which Moody’s determined the rating for a particular security which was backed by a bundle of over two thousand individual sub-prime mortgages.  The bonds were issued by a Special Purpose Vehicle, a particular corporate structure, and that corporation, based on the information about the mortgages and the statistical rate of default and the structure of the corporation was given an AAA rating. 

The interesting question for Texas School Business Officials is how a Texas school bond could ever have a rating less than AAA when the statistical rate of default is zero as there has never been a default?  If a Texas school district were to find itself in default some time in the future, the district would be merged into another district which would have to make the payments. 

The Permanent School Fund’s ability to back all bonds is rapidly being depleted, but should it really make that much difference in the rates and marketability of the bonds? 

4/17/08

Additional State Aid for Tax Reduction

            Potential error spotted in sale of WADA  

In the immortal words of Robby the Robot’s relative B-9, “Danger, Danger!” 

A potential error has been spotted in the Additional State Aid for Tax Reduction S1 and S2 calculations on the 2006-2007 and 2007-2008 Summary of Finances.  This only involves the lower wealth partner who received money from a high wealth district.  This is accomplished by the lower wealth district selling Weighted ADA to the higher wealth district in exchange for a smaller reduction in state aid. 

The questionable data involves the gain by a Chapter 42 district from Chapter 41 Partnerships shown on Line 7 in both the S1 calculation for 2005-2006 and S2 for 2006-2007. 

In some cases, the 2006-2007 number is several times larger than 2005-2006 amount.  The 2006-2007 amount is a calculation of what the amount would have been under old law and, for that reason, will not exactly match any actual WADA sale contract, but such a large variation from one year to the next in a stable district is unexpected.   

In other cases, some districts that are shown as partners on the 2005-2006 Chapter 41 Cost of Options report selling large numbers of WADA show no gain in either 2005-2006 or 2006-2007.  

The danger for the Chapter 42 district is, if the ASATR is overstated in both 2006-2007 and 2007-2008, an eventual correction will cause a recovery of funds for 2006-2007 and a reduction in state aid earned in 2007-2008 approximately doubling the impact on 2007-2008 operations.  The potential increase in funds for districts receiving no credit for a WADA sale is not as dangerous but may have resulted in the district not receiving the funds that were expected when the budget was prepared. 

All districts that participated in a WADA sale should check the Summary of Finances carefully and, if something seems unlikely, rely on the district’s own calculations of aid earned.   

We understand that TEA is aware of the situation and working on a solution.

4/14/08

TEA Finance Updates

            SOF and Expenditure Targets 

Expenditure Targets:   

The 2008-2009 Projected Expenditure Reports have been restored to the Expenditure Targets web page.  Enter your proposed 2008-2009 budget data into the spreadsheet on this page to see how well your district will actually do. 

Summary of Finances: 

Both the 2006-2007 and 2007-2008 Summaries of Finance have been updated and both of these changes may impact FSP payments to the district.  Go to the School District State Aid Reports page and take a look at the reports for your district. 

The 2006-2007 SOF is now marked Final.  As of the morning of April 14, 2008, there was no letter explaining the changes but total state aid and some other data has changed from the “Near Final” version.  Usually the change to “Final” indicates that audited tax collections and some summer programs and data corrections have been incorporated. 

It’s important to understand that tax collections are part of the Additional State Aid for Tax Reduction S2 calculation and any change here may either increase or decrease ASATR in 2006-2007 and in 2007-2008 and all future years.  Actual Interest and Sinking tax collections can impact Facilities aid in 2006-2007 and set a ceiling for the Existing Debt allotment in 2007-2008 and 2008-2009. 

Scroll down in the summary document until you reach the section summarizing the payments to the district and follow the link to the Payment Ledger to see the details of the payments or recoveries that you can expect. 

The 2007-2008 SOF has been updated to a new, much easier to read format with links to sub-sections providing detailed explanations on the amounts on the summary page.  The 2007-2008 SOF has also been updated with earlier ASATR information from 2006-2007.  If it isn’t the same as 2006-2007 now, plan on it catching up by the end of the year. 

In the school finance world, “final” doesn’t mean that something will never, ever change again.  It means that there are no more regularly scheduled updates for every district.  If it is ever discovered that something is not correct, it will be corrected and the summary for that district rerun and additional payments or recoveries will be made.  Changes to 2005-2006 or 2006-2007 can trigger a change in the ASATR for all following years. 

 4/10/08

Expenditure Targets

            TEA spread sheet posted 

TEA has posted and then taken down a spread sheet to calculate whether or not a district is meeting the expenditure targets required by the Texas Education Code and the governor’s executive order.  The spread sheet that calculates compliance on the web page has now been restored.  The reports section of the page was still disabled as of the morning of April 10^th.  The page also contains links to the statute, the executive order and other information. 

TEA has adopted a formula for different types of districts (Major Urban, Rural, etc.) setting expenditure targets in various areas.  For all districts, the target for instruction is 65%.  The target proportion varies by the district type.  The spending categories are Instruction, Leadership, Support Services - Student-Based, Support Services -Non-student-based and Administrative 

The spread sheet will be helpful in planning the 2008-2009 budget, but it needs to be approached with a little care as some of the cells contain formulas while data must be entered in the other cells.  In some cases the formulas rely on data that will be entered farther down the page and will not show anything meaningful until the total budget amount is entered in the green box in cell I35.   

As the cells containing formulae are not locked, look at the contents of each cell before you start typing.

3/31/08

Pupil Projection Template Updated

            Now includes 2007-2008 enrollment 

The TASBO Pupil Projection Template provides a variety of methods for projecting ADA and other student counts for the current school year and several years into the future.  It has been updated to automatically supply the 2007-2008 fall enrollments by grade using the PEIMS data from TEA.  The previous version required the user to fill in this information manually. 

The ADA and FTE history is also automatically filled in for you.  The 2006-2007 attendance information, however, is still that shown on the “Near Final” Summary of Finances. 

Right click here and choose the “save target as…” option to save the spread sheet to your computer.  Some users have had difficulty saving the template if it has been opened directly from the web page.  A link is also found near the bottom of the TASBO home page. 

The template uses macros, so select “Enable Macros” if you get a security warning when Excel opens the file.  Fill in your district number on the Data Entry tab and you should see the district name appear when you tab out of the cell.  Click on the “Fill in History” button just below the district name and the enrollment and attendance history for the district should appear in the tables below. 

If you didn’t get a security warning and the template doesn’t work, open the Tools > Macro > Security… menu on the top line and choose the Medium security level.  After doing this, close Excel and then reopen the file.  This time you should get a security warning, choose “Enable Macros” and all should be well. 

3/27/08

2007- 2008 Tax Rates

            Excel version of TEA list 

TEA division of State Funding has posted a list of the 2007-2008 tax rates as reported to them.  It is a text listing, however, which can not be conveniently manipulated.   

TASBO has prepared an Excel version of this list which can be easily sorted and filtered.  Click on the dropdown list button beside the column heading to sort the list, filter it for a particular value or choose (Custom…) to find a particular range of values. 

Click here to open the spreadsheet and choose “Save As” to save a copy on your computer.

3/26/08

Pension funds sought to finance toll roads

            Discussed at Senate Committee on Finance, Senate Committee on State Affairs 

The March 25^th Joint Hearing held by the  Senate Committee on Finance and the Senate Committee on State Affairs, after discussing the schedule for future meetings and sub-committee meetings, heard testimony from representatives with the Legislative Budget Board, the Attorney General’s Office, and the Pension Review Board concerning the investment of state pension funds. 

The archived video of the meeting is available and makes interesting listening.  The archive of all Senate meetings is also available. 

The newspapers were most interested in the suggestion that the funds invest in toll road projects.  The Express News article featured on MySA.Com is a good example.  The possibility of investing in school bonds wasn’t mentioned, however.  

Of greater interest to Texas educators, however, was the much longer discussion and head scratching devoted to the best way to control volatility in the investments that the funds make while also maintaining a reasonable return.   

The Austin American Statesman’s web site, Statesman.com has carried a blog by Robert Elder which has been commenting on these issues for some time.  This one has paid a lot of attention to TRS issues in particular.   

2/26/08

No One Works for Free

            Budget for extra duty pay 

The San Antonio Express News on MySA.com is reporting that a Bexar county judge has upheld a commissioner of education ruling that a San Antonio school district is required to pay a teacher a day’s pay plus substantial penalties for a day of required duty outside of the contract. 

The district has appealed the ruling, so it’s not the absolute last word, but it will be prudent to see that funds are available to pay people for any extra days before they are asked to work.  We have understood this to be the case for hourly workers who simply must be paid for every hour they work, but this ruling extends that to teachers as well. 

This case is reported to be a situation in which teachers were required to work at a graduation ceremony after the 187 contract days on the school calendar had been completed.  How to apply the principle to more subtle situations such as requiring teachers to attend evening meetings on a work day, staying late or even performing a duty during the day that is not mentioned in the contract is not nearly as clear. 

It may depend on the exact wording of the contract and the district HR policies.  This leads us to another “check with the lawyers first” situation and they will expect to be paid as well.

2/22/08

Senate Committee on Education Public Hearing

            Invited and public testimony
            February 27, 2008 - 09:00 AM

Capitol Extension Bldg., Room E1.028, Austin 

From the meeting notice:   

The Committee will hear invited and public testimony on the following charges: 

Senate Interim Charge:
Report on the implementation of education reforms in House Bill 1, 79th Third Called Special Session. The review should include: the implementation of the high school allotment, the development of the best practices clearinghouse and the electronic student records system, the alignment of curriculum to attain college readiness, student improvement/growth models and access to college credit in high school.

Topics:
            *Electronic transcripts leadership
            *High School Allotment
            *College Readiness  

Senate Interim Charge:
Make recommendations for controlling the costs of textbooks from kindergarten through higher education, and monitor the implementation of HB 188, 80th Legislature, relating to instructional materials.

Topics:  
            *Mid-cycle adoption
            *Review of supplemental materials
            *Textbook credit program
            *Cost of future textbooks
            *Budget balancing  

Senate Interim Charge:
Monitor the implementation of legislation addressed by the Education Committee, 80th Legislature, Regular Session, and make recommendations for any legislation needed to improve, enhance and/or complete implementation. Specifically, monitor the implementation of HB 2237, relating to grants and programs for dropout prevention, high school success and college and workforce readiness in public schools.

Topics:
            *Reading Academies
            *Science Labs  

Public testimony will be limited to 3 minutes per person.  

2/20/08

Municipal Bond Rate Concerns

            Auction rate securities paying sharply higher rates 

Making a school budget is as much art as science, but it does need to include an orderly consideration of the things that can not be known for sure at the time the budget is prepared.  Interest rates are another of unknowable factors which impact the actual cost of operating a school district. 

While Texas school districts do not usually use auction rate bonds to finance facilities, turmoil in this specialized market is impacting the whole municipal bond market and may well increase the borrowing costs for many school districts.  

The Austin American-Statesman carried an Associated Press article on February 18^th:  “Many classes of bonds are being punished for the problems of subprime mortgage debt, but at least one segment of the market is expected to perform well this year: long-term, investment-grade municipal bonds….”

According to Wikipedia , “An auction rate security (ARS) typically refers to a debt instrument (corporate or municipal bonds) with a long-term nominal maturity for which the interest rate is reset through a dutch auction.” 

A February 20^th article in The New York Times opines that part of the problem is that, “The failures also indicate that talk of rescuing municipal bond insurance companies, like Ambac and MBIA, has not reassured investors. Auctions continue to fail, even at absurdly high yields, if the principal guarantee of repayment is an insurance policy.”

Bloomberg also discusses the problem, while Seeking Alpha explains the interaction between municipal bonds and hedge funds in greater detail.  Both of these articles contain links to even more information.

The Texas Permanent School Fund bond guarantee program side steps much of the insurance problem, but it is no longer nearly automatic as the capacity of the fund to guarantee all bonds is rapidly being used up.  The TEA website has the application information including the rules for allocating the available guarantee capacity.  Be sure to read the Disclosure Statement for the Bond Guarantee Program to understand the capacity limit.

2/18/08

Utility Costs May Increase

            Another budget consideration 

DallasNews.com is reporting that ERCOT, the Electric Reliability Council of Texas, which operates most of the state’s power grid, is requesting an increase in the rate that it charges.  

The whopping 34% increase mentioned in the article is only for the small part of the total cost of power that goes for the management of the delivery system and does not include the actual cost of either the delivery or the generation of the power, so it’s definitely not a proposed 34% increase in anyone’s electric bill.  It’s also only a request for an increase at this point.  But it is likely to result in an increase of some sort. 

Schools are large consumers of electricity and other fuels and not many people are expecting any energy cost to go down in the next year.  The question is, “How high is up?”  The budgeting problem is even more complex as rate increases can sometimes be mitigated by negotiating for new contracts with suppliers and by reducing consumption by spending money on things like insulation and more efficient climate control and lighting systems. 

Remember also, that House Bill 3693, and Senate Bill 12 require that school districts plan on reducing electricity consumption by 5% a year beginning September 1^st, 2007.  For this reason, budgeting for efficiency measures is a requirement, not an option.  The bills also require reporting among other provisions.   

More information about the reporting requirements and resources for meeting the goal are available from the State Energy Conservation Office. 

2/15/08

2007 Preliminary Value Study Released

            Comptroller’s values to be used during the 2008-2009 school year 

The comptroller has released the preliminary 2007 Value Study. 

The cost of operating the public school system in Texas is shared between the state and the local tax payers.  These property values assigned by the Comptroller of Public Accounts determine the split.  Even though recent legislation has shifted the split toward more of the bill being paid by the state and the hold harmless provisions make the assigned value and the actual tax roll less import to district finances, the value still matters.  

Check out the report for your district.  Remember that lower assigned values mean more state money (or less recapture.)   

If the comptroller has accepted local values as reported by the appraisal district, check to see that the roll that was accepted is actually the correct one. 

If the comptroller has not accepted local values, get The Property Value Study  and the

How to Protest publication from the comptroller’s website and check to see if there is anything that can be done.  It takes a while for using state values instead of local values to make a difference, but ultimately there is a penalty. 

2/14/08

Mileage Reimbursement Rates Increase – Again

            More things to consider for the budget 

From the TEA letter:   

Effective January 1, 2008, the automobile mileage reimbursement rate (in-state and out-of-state) has increased from 48.5 cents per mile to 50.5 cents per mile or local policy, whichever is less. 

If this seems like deja vu all over again (to quote a baseball sage,) the rate changed to $.485 from $.445 on September 1^st, 2007.  The rest of the travel reimbursement rates did not change this time.  These rates are the rates that the state pays for state employee travel and are the maximum that can be reimbursed from funds that have anything to do with TEA.

2/12/08

Title I School- wide Program Guidance

            New accounting and audit requirements  

The U.S. Department of Education has released new Title I fiscal guidance establishing a framework for school-wide programs.   

The new guidance establishes three separate scenarios:

(1) complete consolidation of funds;
(2) consolidation of only federal funds; and
(3) non-consolidation that nonetheless allows for use of Title I Part A funds on a school-wide basis 

This new guidance will be reflected in the annual Single Audit Compliance Supplement due for publication in March, The new guidance document can be found on the Department of Education web site at:  http://www.ed.gov/programs/titleiparta/fiscalguid.doc. 

2/12/08

Postage Increase Announced

            First Class to be $.42 on May 1^st  

Another bit of information for the budget:  The United States Postal Service has announced a price increase effective May1, 2008.

First-Class Mail letter (1 oz.)                               $0.42
First-Class Mail letter (2 oz.)                               $0.59
Postcard                                                           $0.27
First-Class Mail large envelope (2 oz.)                  $1.00
Certified Mail                                                     $2.70

Price increases for other services will be announced in March. 

http://www.usps.com/prices/welcome.htm?from=bannercommunications&page=prices

2/7/08

Facilities Aid Rules Amendments

            TEA proposes rule changes for IFA and EDA 

TEA has posted amendments to the Commissioner’s Rules concerning state aid for facilities.  There are rule changes proposed for both the Instructional Facilities Allotment (IFA) and the Existing Debt Allotment (ED.) 

The new rules address statutory changes which make bonds issued before September 1^st, 2007 eligible for the EDA and implementing Senate Bill 962 which modified the calculation of the wealth per student in districts impacted by base realignment used to determine eligibility for the IFA. 

Common to both programs are rule changes which: 

Required that only the debt service information on file with the state information depository or filed with TEA as appropriate is eligible for consideration.

Required that refunding and restructuring must be reported for the bonds to remain eligible

Define Interest Rate Management Agreements 

There are numerous other changes proposed.  Some of them would change or clarify certain deadlines and reporting requirements while others propose “clean up” changes which may also impact some school districts.   

There are a number of other rule changes proposed.  Information about all rules and proposed changes can be found of the Texas Education Agency – Administrative Rules web page.

2/5/08

2007–08 Revised Summary of Finances

            Updated information posted  

A revised Summary of Finances (SOF) and other related reports for the 2007–2008 school year have been posted to the School Finance website of the Texas Education Agency (TEA) at www.tea.state.tx.us/school.finance/.   Follow this link http://www.tea.state.tx.us/taa/schfin020408.html to read the letter. 

At this point, most of the information on the 2007-2008 Summary is estimated and the left hand column, the Legislative Payment Estimate (LPE) is the basis for advancing funds to the district during the school year.  Most, but not all of the information in this column is set before the year begins and does not change during the year. 

The right hand column, the District Planning Estimate (DPE), is advice to the district about potential earnings for the year.  At this point, this column is nearly the same as TEA and has little new information. 

Payments to the district will ultimately be adjusted to actual earnings after the close of the school year.  It is essential that the district complete the 2007–08 state aid template produced by the Education Service Center in Region XIII as critical information such as actual attendance will not be available to TEA to include in the Summary of Finances until after school is out.  The link to the template on the website's "State Funding Worksheets Page" is http://www.tea.state.tx.us/school.finance/funding/index.html.) 

Updated information highlights include: 

2006 CPTD Value – The property value being used to compute your district's state aid was certified by the Comptroller’s Property Tax Division (CPTD) and has been revised to reflect the implementation of House Bill 5.  The value has been updated in both the LPE and DPE columns.  

2007 Local Values – The TEA will use the local property values reported by the CPTD to calculate tax collections for those districts that did not report collections to the TEA on the Tax Information Survey last fall. 

Tax Rate – Adopted 2007-2008 rates have been incorporated into the state funding calculations.  

Tax Collections – If the district did not submit tax collections, TEA has reestimated collections  

Existing Debt Allotment (EDA) and Instructional Facilities Allotment (IFA) – The preliminary earned allotment appears on the first page of the SOF report under the “Additional Aid” heading.  Settle-up amounts for 2006–07 have been incorporated into these payments 

State Compensatory Education – The information regarding the number of students who were eligible for free or reduced-price breakfast and lunch has been updated on page 3 of the SOF report.  

Amended Calculation of Revenue Target – Several changes have been made in the calculation of the revenue target:

Adjustment to Transportation Allotment  – The revenue target has been adjusted to reflect the difference between the current-year transportation allotment and the amount of the transportation allotment in the target year, based on the maximum of S1, S2, and S3.
 

Adjustment for the New Instructional Facilities Allotment (NIFA) – The revenue target has been adjusted to reflect the difference between the current- year NIFA allotment generated and the NIFA allotment generated in the target year.

1/25/08

CPTD Value Update

To explore the possible impact of the value reduction complete the state aid template for a district, note the total state aid and then reduce the CPTD value leaving the rest of the data unchanged and note the difference.  If there is an increase in state aid, the district may consider contacting the Reporting Section of the Comptroller’s Property Tax Division at 1-800-252-9121 to correct the value.  

1/23/08

Payment of TRS Above Statutory Minimum

On December 21, 2007, Commissioner Robert Scott requested an Attorney General’s Opinion to determine the minimum salary to be used in calculating the required contributions by school districts to the Teacher Retirement System for compensation above the statutory minimum salary.  Click here to review this request

1/23/08

HB 5 Value Adjustments

            Many show no reduction 

House Bill 5 passed in the last regular session of the Texas legislature mandated a reduction in the frozen homestead ceilings proportional to the reduction in the school district operating tax rates set in place by House Bill 1 beginning with the 2007 tax year. 

The bill also directed that the 2006 property value study conducted by the comptroller be adjusted as if the lower homestead taxes had been in place that year.  The 2006 value study is used in the state aid calculations for the 2007-2008 school year. 

The comptroller has made the adjustment and issued the report and the adjusted values have been included in the TEA Summary of Finances, but a large number of districts show no reduction in value.  This is surprising as it would be the rare district that had no homestead exemptions that were granted before 2006.  

Some districts may have not responded to the request for information either through miscommunication or misunderstanding of the need for the adjustment.  While the House Bill 1 changes in school funding greatly reduce the impact of the value study on district finances, it did not eliminate it completely.  The bulk of the reduction in tax collections will be offset by an increase in Additional State Aid for Tax Reduction hold harmless provision. Districts that have tax effort above the compressed tax rate or receive facilities aid will earn more state aid if the assigned property value is reduced.  This is the mechanism that the state uses to make up the rest of the reduction in tax collections and there is no separate payment. 

To explore the possible impact of the value reduction complete the state aid template for a district, note the total state aid and then reduce the CPTD value leaving the rest of the data unchanged and note the difference.  If there is an increase in state aid, the district may consider requesting an audit of the 2006 value study to correct the value.  

The forms for requesting an audit can be found on the comptroller’s website.  An explanation of how the individual homeowner’s tax ceiling is to be adjusted is also available. 

1/14/08

Adjusted 2006 Property Value

            HB 5 Homestead Adjustments 

H.B. No. 5 Extends the benefit of the reduction in school district tax rates by adjusting the frozen homestead taxes downward by proportioning the frozen homestead levy downward by the reduction in the district tax rate.  School districts are held harmless by additional state aid to the extent that the reductions in the value certified by the comptroller does not replace the lost property tax revenue. The comptroller is directed to certify the value before and after the reduction in the homestead freeze in addition to the amount that values would have been decreased in the 2006 tax year to be used in the 2007-2008 state aid calculations. 

The comptroller’s report is available at http://www.window.state.tx.us/taxinfo/proptax/hb5adjusted.pdf most districts can expect to receive an increase in state aid for tax effort beyond the first band of Tier II and Facilities Aid.   

12/19/07           

Final AYP Ratings Published

            Get ready for the questions 

Remember last week’s Campus Report Cards?  This is a different rating. 

Under the accountability provisions in the No Child Left Behind (NCLB) Act, all public school campuses, school districts, and the state are evaluated for Adequate Yearly Progress (AYP).  Links to the report and a lot of supporting information are TEA’s AYP webpage.   

 12/17/07

House Select Committee Meetings Posted

            Education and Appropriations

The House Select Committee on Higher and Public Education Finance and the Appropriations subcommittee on Education have posted meetings beginning January 15^th.  The schedules and agendas are on the Texas House of Representatives web site.  Check back on the schedules and topics as they are subject to change.

Topics include invited testimony from TEA regarding public school finance and formula funding, invited testimony on the spreading or "smoothing" of state payments to school districts throughout the year. (House Appropriations Committee Interim Charge #12) and public testimony on public school formula funding and allotment issues. 

12/17/07           

School Health and Related Services (SHARS)

            Cost Report training, due date 

The Texas Health and Human Services Commission (HHSC) has requested and received an extension of the 2007 cost report due date to April 1, 2008.  This report is usually due March 1^st. 

More information is available on the