Burnt Orange Report

Perry's School Plan

By Byron LaMasters

This sounds like Voo-Doo economics to me. Rick Perry wants to lower property taxes, and give more money to public schools. Supposedly "sin taxes" will be able to cover it, but I'm skeptical. Anyway, the Houston Chronicle reports:

Gov. Rick Perry today unveiled a school funding proposal he said would cut school property taxes by $6 billion while adding $2.5 billion to public schools.

The governor proposed treating business property taxes differently from residential property taxes and outlined a series of new state revenue raisers for education, including a $1 per pack increase in the state cigarette tax, a $5 admission tax on adult entertainment and video lottery terminals at racetracks.

The changes in property taxes and the gambling proposal would require state constitutional amendments, which would need the approval of Texas voters, as well as legislators.

Perry did not set a date for a long-anticipated special session on school finance, leaving people still guessing as to when -- or if -- there will be one this year.

Perry frequently has said he wants agreement on a new school funding plan before calling lawmakers back to Austin. Lawmakers have not reached a consensus.

"I believe we can reform our school finance system without a major tax hike, without a broad-based business tax and without an across-the-board rate hike on the existing sales tax base," Perry said at a high school in downtown San Antonio.

He said the new state revenue sources he is proposing would target "tax fairness, unhealthy behaviors or voluntary actions."

Additionally, he said he wanted to close loopholes in the state franchise tax and auto sales tax.

Perry said his plan would immediately reduce residential property taxes by an average 17 percent while increasing the state's share of public education funding from the current 38 percent to about 60 percent.

Under the proposal, school property taxes on residences would continued to be levied by local school districts, but the cap for school operations would be reduced from the current $1.50 per $100 valuation to $1.25.

Business property taxes, if legislators and voters approve, would be levied statewide and capped at $1.40 per $100 valuation. This so-called "split-roll" approach, which has been circulating privately for several weeks, has drawn widespread opposition from businesses, who fear they would be singled out for higher school taxes.

Well, Perry is right in that the state should take the burden off of local school districts, and pay more of the bill for public schools. I disagree with the idea of significantly raising "sin taxes" for the principle reason that they are a regressive tax, felt most by the poor. I'm not against high cigarette taxes (or high alcohol taxes, etc.) necessarily, but I think that the best places for those taxes to go is in helping address the problems they create (i.e. health care). I'm with Andrew on this one. State Rep. Eddie Rodrieguez (D-Austin) has the best plan.