School districts within Texas have paid more than $20 billion in recaptured taxes to the state since legislation was passed in 1993 that redistributes money from property-wealthy school districts to those that are considered property-poor.
Comal ISD was notified by the state in January that it will pay an estimated $8 million in recapture of local property taxes to the state for fiscal year 2018-19.
Recapture, commonly referred to as Robin Hood, is determined by a formula that divides property wealth in a school district by the Weighted Average Daily Attendance, or WADA. When property wealth is growing at a rate faster than the student population, districts must pay the overflow back to the state.
“If you’re a district that has a great deal of wealth dividing it between a lot of students then that might keep you below the threshold, but if you have fewer students you may fall above that line and have to pay recapture,” said Christy Rome, executive director of the Texas School Coalition, an organization that advocates for reducing the reliance on local taxes as a source of state revenue.
Steve Stanford, executive director of communications and government relations for Comal ISD, said the district originally anticipated paying $4 million to the state for FY 2018-19.
The timing is tricky, Rome said, because school districts pay recapture on the prior year’s certified property values, so it takes the system one year to catch up.
As it stands now, Comal ISD projects falling $800,000 shy of breaking even on its budget after the $8 million in recapture is paid. So far, the district has accounted for the cost of opening two new middle schools in its next budget cycle, but they have not yet accounted for the additional teachers it will need elsewhere in the district.
According to Comal ISD Director of Finance David Andersen, the district will adopt its annual fiscal budget in late June, and there are still pieces of the puzzle to be determined.
In addition to paying $8 million to the state, recapture will hit Comal ISD’s budget in other ways, Rome said.
“If you pay recapture, you don’t receive state transportation funding so that’s a big hit to Comal ISD because, being as geographically large as they are, they have to run a lot of buses and they are paying for that with their own local district dollars and not getting any compensation from the state,” she said.
According to Rome, recapture allows the state to free up funding for other initiatives. She feels the predicament Texas school districts find themselves in with recapture exemplifies the need for school finance reform.
“I think the problem with our system is that it’s so out of date, and we have a system that requires districts to send money to be spent elsewhere, and they don’t have the resources they need to educate their own students,” she said.