Record increases in Travis County property values drove up Austin ISD’s expected recapture payment from $800 million to $855 million, according to a newsletter sent to district families on April 22.

Recapture refers to Texas legislation that requires property-rich school districts, such as AISD, to pay a portion of locally collected property tax revenue to the state, which then distributes the funds to property-poor districts. The policy was implemented in 1993 as an effort to equalize financing across all school districts in the state.

Due to Austin’s rapidly increasing property values and the district’s struggle with low enrollment, AISD has the highest recapture payments of all districts in the state—more than Houston, Plano and Midland, the next three highest-paying districts, combined.

Less than half of every dollar collected from Austin taxpayers goes to AISD, which puts a strain on the district’s budget, according to the April 22 newsletter. The district announced on April 6 that its expected recapture payment for the 2022-23 school year would be $800 million.

AISD’s $1.5 million preliminary budget for fiscal year 2022-23 was created with $800 million in recapture payments in mind—based on an expected 8% increase in property values. When property tax appraisals were released last week, the district saw an 18% increase in property values instead, the newsletter said. This increased the district’s recapture payment to $855 million.

AISD is distributing a survey to educate residents on the school finance system and gather community feedback on the recapture process.

The district has proposed solutions to high recapture payments, including the state granting school districts a 10% discount for paying recapture early, allowing districts to deduct social security contributions from recapture payments and increasing public education funding to shift the burden away from local property taxpayers.