The student growth Cy-Fair ISD has experienced over the past two decades has resulted in the need for numerous new schools, teachers and supplies, but it has also classified CFISD as a "fast-growth" district by the Austin-based Fast Growth School Coalition.
Established in 1996 in response to the Edgewood IV school finance lawsuit, the 85 districts eligible to join the coalition make up 80 percent of school enrollment growth in Texas, Executive Director Michelle Smith said.
"Every year, Texas adds 80,000 children and 80 percent of them are going into a very small number of districts, which are constantly building more buildings and having to take on more debt to do it," she said. "The state is good at encouraging people to come to Texas through various business incentive programs, but it isn't as good at supporting people after they get here as far as local needs are concerned with schools, libraries and parks."
Fast-growth challenges
Demographic projections estimate 2,000 new students will enroll each year in CFISD through 2020, leaving administrators responsible for the operating costs of a fast-growth district, which had 112,946 students enrolled as of Sept. 12.
"There are challenges for a fast-growth district in terms of developing an operating budget and in terms of construction costs and facility needs," CFISD Chief Financial Officer Stuart Snow said. "Then on the operating side we have a need for additional teachers and those ancillary positions like custodians, bus drivers, food service workers and central administration staff."
The Fast Growth School Coalition considers districts eligible for membership if they experienced at least 10 percent enrollment growth in the last five years and have a minimum of 2,500 students.
Many of the districts are also in popular suburban areas outside Dallas, Austin and Houston, Smith said.
"Most fast-growth districts generally have schools that are performing well and tend to be in suburban areas that have good libraries and parks and are places that people who have kids want to live," she said. "You probably don't want to be in downtown Houston if you have two or three kids, you want those community perks."
Even though CFISD does face challenges financially, there are benefits to being a fast-growth district, Snow said.
"We are one of the largest employers in Harris County and probably the largest employer in Northwest Houston," he said. "When you have a successful school district and one that is highly regarded, that tends to bring more people in and causes a fast-growth phenomenon."
Growth allotments
The Fast Growth School Coalition began advocating with legislators in the late 1990s to tweak school funding formulas in favor of fast-growth districts, Smith said.
"The Legislature started talking about various weights and allotments for districts, but there was nothing to address fast-growing districts and their facility needs," she said. "Allotments were then put into place to bring down property taxes, but over time the numbers weren't adjusted so a lot of our fast-growth districts aren't receiving those funds anymore."
The Existing Debt Allotment was put into place in 1999 as a funding mechanism for fast-growing districts and is funded by a yield of $35 per average daily attendance for each cent of eligible tax effort. However, many districts are no longer eligible for the allotments because of increases in property wealth, which has caused districts to raise their interest and sinking tax rates to keep up with growth, Smith said. During the 1999-00 school year, 91 percent of districts were eligible for state support, while 56 percent were eligible as of the 2013-14 school year, according to the Fast Growth School Coalition.
"Texas is very much about local control, and if a community wants to build facilities, they should be able to do so," Smith said.
The New Instructional Facilities Allotment was also put into place in the late 1990s to help fast-growth districts, but it was defunded by the 82nd Legislature in 2011.
"The state gave districts $250 per student for the first year a new building was open, and that helped with desks and materials and other things needed to open a new building," Smith said. "The No. 1 priority for us will be restoring funds for this now that the state isn't in a budget crisis."
CFISD no longer receives EDA or NIFA money from the state, Snow said, leaving the district to rely solely on property tax revenue to pay principal and interest on bonds sold to build and renovate new facilities.
"In terms of facilities, [the loss of funding] impacts the additional need for portable buildings or new schools," Snow said. "Coupled with that, as we have a need to build new schools we incur additional debt, and then when you run out of the [bond] authorization, you have to go back to the community for approval of another authorization."
2015 Legislative outlook
On Aug. 28, state District Judge John Dietz ruled the state's school finance system unconstitutional for the second time, reaffirming the opinion of the more than 600 districts across the state—including CFISD—that joined the school finance lawsuit.
"We're on record as a district saying that the system was not adequate and efficient and didn't provide the sufficient funds to provide the constitutional level of education we are required to provide," Snow said.
However, the ruling is expected to be appealed to the state Supreme Court, and a final ruling is not expected until mid-2015, Snow said. District officials are not expecting major decisions to be made during the 84th session regarding school finance. A special session could be possible later in 2015 after a final ruling.
Another reason many of the funding allotments have not been updated over the years involves the complexity of the school finance system, Snow said.
"Districts across the state are so diverse in their needs, so legislators have a difficult time in terms of being able to make substantive changes to the system that benefit all districts," he said.
