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June 10, 2003

Equity Towards Excellence: A Proposed Framework for Funding Public Education in Texas


The problem of funding public education equitably while preserving local control and local priorities is not unique to Texas. But the current means by which Texas funds public education, dubbed the “Robin Hood” plan, is rightfully scheduled for execution in an upcoming special session of the Texas legislature. The question before the state legislature, then is how to meet both the constitutional and judicial requirements for funding public education.

But an additional question that legislators should consider is: How can the education funding system become a tool to improve education in Texas without burdening the Texas economy? One unfortunate consequence of the Robin Hood debate has been too much emphasis on the funding mechanism itself, and not enough emphasis on the fact that Texas has an education problem that is bigger than the education funding problem. The funding mechanism is but one facet of Texas' education problem. Any proposed solution to the education funding problem should improve education while at the same time not undermining the Texas economy.

It is not enough to provide equalized funding for education. Texas should provide every Texas student an excellent educational opportunity, not just an equally-funded education. The funding system for education should serve as a tool toward accomplishing the goals of providing an education adequate to produce functioning citizens. Currently, it does not.

The Current "Robin Hood" System is Undesirable. The public is clearly unhappy with the Robin Hood plan. Taxpayers don't like having their tax dollars arbitrarily appropriated by the state and redistributed elsewhere. Property taxes are skyrocketing, and "paying" school districts are attempting all manner of questionable and risky schemes to shield money from the effects of Robin Hood. Further, the Robin Hood plan essentially functions like a statewide property tax, which is forbidden in the Texas constitution.

Robin Hood fails to address the prioritization of education funding. It is well documented that many schools spend a lot of money and still deliver a mediocre education. Objectives must be prioritized, and resources must be directed at the most important objectives. Too many schools are spending too much money on non-essentials and are failing to deliver an adequate basic education.

Principles for a Desirable School Funding System

A school funding system should provide an equal opportunity for all students in Texas to acquire an excellent education, yet should allow local control and local discretion. It should make possible comparisons between schools and between school districts on how well they are delivering on their obligation to provide an adequate education.

A school funding system should allow local school districts to supplement the adequate equalized funding their local education system receives as generously as they choose, without fear of having their local taxes redirected to other locations. Taxpayers understand that taxes paid to a central authority, whether state or federal, will be widely distributed. But they expect that their local tax dollars, paid to local jurisdiction, will largely remain within the jurisdiction.

We suggest that the State of Texas commit to a system of centralized and equalized funding for a core education curriculum. Principles of such a system should include the following:

  1. A Core Curriculum should be determined for Texas public education students. Texas should determine a core curriculum that comprises an excellent education. This curriculum should cover those subjects in which proficiency is necessary to function as a citizen. It is obvious that it would include Texas and U.S. history, reading, writing, math, science, health, civics, and consumer skills.
  2. It should be determined how much must be spent, per pupil, to execute the core curriculum. The amount should be figured on the basis of core curriculum costs and teachers' salary and benefits, not on outside-the-core, outside-the-classroom, capital or administrative expenses.
  3. Adequate funding for the core curriculum should be equally and centrally funded by the State of Texas. Public schools in Texas should receive from the state a fixed amount per-pupil statewide for the core curriculum, so that all schools are competing on an equal funding basis.
  4. The Core Curriculum should be enforced with high stakes testing and measurement. "High stakes testing" means testing where there are real consequences for schools that consistently under perform. But the penalty for poor performance should not fall only on the shoulders of students, but also on the administrations of failing schools.
  5. Exceptions should not be made to the central funding equation. Centralized and equalized funding will allow "apples to apples" comparisons between schools. Poor performance should not be rewarded with increased funding, which creates a perverse incentive. Rather, the assumption should be that if other schools perform adequately with X amount of funding, so should all schools.
  6. Local jurisdictions should be free to supplement the funding of their local education to whatever extent the voters choose. If a local school district wants to fund a domed stadium for their football team, or an arts magnet school, they should be free to do so. Local districts would be responsible for funding facilities, sports programs, optional or advanced-placement curriculum, electives, and extra-curricular activities.
  7. A means of escape should be available to students who are trapped in a school that consistently fails. The state has an obligation to provide an adequate education to every pupil in Texas. If the state cannot accomplish this through the public school system, it is not relieved of its obligation to provide that student with an adequate education. There must be an escape mechanism for students trapped in schools that consistently fail to meet the standards, such as a voucher that can be used toward private tuition or home-school curriculum purchases.

By determining a core curriculum and by limiting state funding to that core, one result will be to clearly discriminate between the necessities in education, and the “niceties.” This should result in a much-needed reemphasis upon the essentials.

Segregating the funding sources, i.e., between state funding of necessities and local funding of niceties, will make accountability clear. School districts will be accountable to the state for how well they perform on the core curriculum, and will be accountable to local taxpayers for everything else. Local taxpayers will know exactly where their tax dollars are being spent, and can make better-informed decisions when they are asked for adjustments in funding.

Voters and taxpayers within the local district would know that they have total control over their tax dollars, and requests by the local jurisdiction for increased funding would be easily traced to the ultimate goal of those funds.

No New (net) Taxes. There is no reason why a net increase in state taxes should be necessary.

  1. An intentional design of this scheme is to shift funding to necessities, which should make more than enough money available for the core curriculum.
  2. The problem in Texas education finance is a cost structure problem, not a problem of adequate funding. In the current funding regime, schools are under little pressure to control costs, and to make sure that funding is going into the classroom, rather than into administrative bloat. Demanding that centralized state funding goes only into the core curriculum should help local school districts prioritize their expenditures, as would the threat of termination for administrators who consistently fail.

It should also be noted that the need for a new school funding system may prove to be an excellent opportunity for much-needed reform of Texas’ revenue system.

It is well known that, in the last twenty years, schools have spent an increasing share of their funds on administration and “social” items, and have spent less on direct classroom instruction. As school districts are forced by the new financing system to focus on essentials, they should begin to shift more and more resources back into the classroom.

This is by no means a comprehensive proposal for public school finance, and there is much work that needs to be done. It is hoped that this proposed framework will begin a debate that will lead toward a new funding system that provides an excellent educational opportunity for every Texas student without placing new burdens upon the economic engine of the Texas economy.

Tom Giovanetti is President of the Institute for Policy Innovation.


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