The Republican-led Texas Legislature approved a sweeping bipartisan school finance bill that brings an extra $4.5 billion into Texas classrooms and pours $1.6 billion toward teacher raises, marking lawmakers' latest attempt to overhaul how the state pays for its troubled public school system.

The House and Senate on May 25 also passed a property tax reform package, another of Texas Republicans' top-stated policy priorities for the legislative session. But it is also one that rankles many local officials who see it as encroachment on local control.

The GOP majority vowed to tackle a school finance fix after losing more than a dozen seats in the 2018 midterms – a change in course that follows repeated clashes with public schools over slashed budgets and appeals to religious and private campuses.

In 2016, the Texas Supreme Court ruled that the system that funds schools for more than 5 million students was deeply flawed but also minimally constitutional. Lawmakers had promised to deliver on the issue this year.

Rep. Dan Huberty, R-Kingwood, called the school finance measure, which he sponsored, "a roadmap for the future of Texas" and a true collaboration between the chambers and the GOP leaders.

"We never lost sight of our goals, of ... what's right for the students and the people of the state," Huberty said.

Some lawmakers in both chambers expressed concern over how the state would afford the changes in years to come.

Huberty's proposal would also send another $5 billion to schools for property tax relief. Texas has no state income tax, meaning schools rely heavily on local property tax revenue.

A portion of the bill would mandate that school districts earmark 30% of their added funding to provide wage increases to full-time teachers, librarians, school counselors and nurses. School district officials would have flexibility in allocating another 25% in raises to any full-time employees.

The final measure also includes a merit pay program that could compensate teachers the district considers exceptional even more.

Lawmakers who worked on the new spending plan say the raises amount to roughly $4,000 for teachers with more than five years in the classroom.

But some education groups have expressed disappointment over the bill's increased focus on property tax relief rather than classroom dollars. Teacher salaries in Texas are currently about $7,000 below the national average, according to the National Education Association.

The school finance measure would increase annual, per-student funding by $1,020 to $6,160, while boosting funds for children who need extra instruction to learn English. It would fund full-day pre-kindergarten for low-income students and provide further funding to better educate dyslexic students.

The bill looks to adjust the current "Robin Hood" system by reducing recapture payments by 47% over the next two years. That system is meant to force school districts in wealthy areas to share some local property tax revenue with those in poorer parts of the state.

“It's a good first start, no doubt,” said Chris Wallace, president and CEO of the North Texas Commission, a public-private partnership that advocates for issues of importance to the North Texas region.

“They [did] a lot better than they have in previous sessions. It is, as you know, our No. 1 issue of our region, and that is, do we have the employees to skillfully fill the jobs that we need them to fill in the next three to five years and funding public education is a long way for us to get there. They took big steps. We congratulate the legislature on HP3.”

The other bill approved May 25 wouldn't reduce property taxes but would require voter approval if local governments raise rates 3.5% or more.

Local governments can currently raise rates by as much as 8% without an election. It was less popular with city, county officials and other municipal groups who have maintained attempts to impose low election triggers are not practical and have chafed at such proposal.

North Texas Commission’s Wallace said the fact that the trigger is now 3.5% is better that what it started out at: 2.5%.

“That's I guess a good thing, but I think a lot of cities and counties are going to have to look at core services that they provide our citizens and our businesses and prioritize,” he said.

“I think there will be some things that will be cut over time that citizens are going to take notice of, and local elected officials and city administrators and county executives are going to have to point to the legislature,” Wallace said.

Disagreements over both issues during the 2017 legislative session left lawmakers unable to pass a measure that would have pumped $1.6 billion into state classrooms despite bipartisan support.

Wallace said the session seemed to focus on state control versus local control, something municipal leaders across the state have been concerned about for some time.

“To us this session was state versus local control and I think most business leaders and us included would tell you, Chambers of Commerce and others that it's best at the local level, and that was certainly not the tone of the session,” said Wallace.

Wallace did note that the Legislature did pass extensions to economic incentives for local governments.

Chapter 312, which allows cities and counties to exclude new development from rising property taxes for up to 10 years, and Chapter 313, which allows school districts to offer limited taxes in exchange for property improvements and job creation, were passed.

“We worked very hard on that with our coalition partners all around the state,” he said. “That was another top priority.”

The North Texas Commission and other municipal groups also were able to kill proposals in Senate Bill 29 and House Bill 281 that would prohibit cities spending tax dollars on lobbyist groups to advocate on a city’s behalf at the Legislature.

“Many cities and counties don't have the resources to be in Austin, with their voice being heard all the time,” Wallace said.

“We’ve got some work to do this interim to really continue to work with our 50 State legislators that represent our region within our 13 counties to make sure they really understand the importance of local, city and county voices being heard during the interim and during the Legislative session,” he said.

The budget bill was not yet signed as of May 30.

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