1. Welcome! Membership Meeting September 27, 2014

2. Meeting Overview I.Welcome and Introductions II.School Finance Litigation Update III. Legislative Update IV. Election of Officers V. Adjourn

3. © 2014 Haynes and Boone, LLP3 Update on Texas School Finance Litigation TASA Convention September 27, 2014

4. © 2014 Haynes and Boone, LLP4 It would be arbitrary, for example, for the Legislature to define the goals for accomplishing the constitutionally required general diffusion of knowledge, and then to provide insufficient means for achieving those goals. West Orange-Cove v. Neeley, 176 S. W.3d 746,785 (Tex. 2005) West Orange-Cove v. Neeley

5. © 2014 Haynes and Boone, LLP5 The Perfect Storm

6. © 2014 Haynes and Boone, LLP6 6 Source: Moak, Casey & Associates October 2012

7. 7 Revenue per Student in 2004 Dollars Ex. 6618

8. © 2014 Haynes and Boone, LLP8 8

9. 9 RISD Inflation Adjusted Revenues per WADA: Operating Fund (Net of Recapture)

10. © 2014 Haynes and Boone, LLP10 Difference Between Texas Per-Pupil Spending and National Average

11. $1.50$1.25$1.00$.75$.50$.2520042004

12. $1.50$1.25$1.00$.75$.50$.25 2006 Restructuring (post WOC II)

13. $1.00$.75$.50$.25$1.50$1.25$1.00$.75$.50$.25 2006 Restructuring (post WOC II)

14. Enrichment $1.00$.75$.50$.25 2006 Restructuring (post WOC II) $1.04 (TRE) $1.17

15. $1.00$.75$.50$.25 Enrichment $1.17 GDK HB3 CCRS (curriculum changes) STAAR/EOC Increase in ELL/Econ. Disadv. $1.04 (TRE) Changes since 2006 2006 Restructuring (post WOC II)

16. Enrichment $1.00$.75$.50$.25 $1.17 GDK HB3 CCRS (curriculum changes) STAAR/EOC Increase in ELL/Econ. Disadv. $1.04 (TRE) What should have happened

17. © 2014 Haynes and Boone, LLP17 Arguments regarding financial efficiency

18. © 2014 Haynes and Boone, LLP18 1. Districts with higher Tier 1 per-WADA funding are overwhelmingly districts in smaller communities for whom funding comparisons are not always meaningful. Arguments regarding financial efficiency

19. 19 Presentation of Catherine Clark of TASB Ex. 6622 = $228 $5,801 $5,573 176,531 / 6,078,575 = 2.9% 6,078,575 Total WADA

20. © 2014 Haynes and Boone, LLP20 2. Chapter 41 districts have already borne the brunt of funding cuts over the last several years and still have not been restored to pre-cut levels. Arguments regarding financial efficiency

21. 21 Ex. 6622

22. © 2014 Haynes and Boone, LLP22 3. In an environment of rising costs and standards, no district should now be brought below its hold-harmless level established years ago. Arguments regarding financial efficiency

23. © 2014 Haynes and Boone, LLP23 4.Taking funds from a small group of districts (or increasing recapture on these districts) would help no one. The emphasis should be on bringing up all school districts in Texas. Arguments regarding financial efficiency

24. Texas State Supreme Court - 2005 Scott A. BristerDon R. WillettHarriet O’NeillDavid M. MedinaDale Wainwright Wallace B. Jefferson Phil Johnson Paul W. Green Nathan L. Hecht

25. Texas State Supreme Court - 2005 Scott A. BristerDon R. WillettHarriet O’NeillDavid M. MedinaDale Wainwright Wallace B. Jefferson Phil Johnson Paul W. Green Nathan L. Hecht

26. Texas State Supreme Court - 2011 Scott A. BristerDon R. WillettHarriet O’NeillDavid M. MedinaDale Wainwright Wallace B. Jefferson Phil Johnson Paul W. Green Nathan L. Hecht Eva Guzman Debra H. Lehrmann

27. Texas State Supreme Court - 2014 Don R. WillettDavid M. MedinaDale Wainwright Wallace B. Jefferson Phil Johnson Paul W. Green Nathan L. Hecht Eva Guzman Debra H. Lehrmann Jeffrey S. Boyd John DevineJeffrey V. Brown

28. © 2013 Haynes and Boone, LLP28© 2013 Haynes and Boone, LLP JOHN TURNER Partner Haynes and Boone, LLP john.turner@haynesboone.com 214.651.5671 Thank You!

29. Legislative Update Christy Rome Executive Director

31.  All new state leaders  Governor  Lieutenant Governor  Comptroller  Attorney General  New Committee Chairs  Senate Education  Senate Finance  House Appropriations 84th Legislative Session

32.  Speaker Straus expected to be re-elected  Currently, 63% of members are certain to return (51 Republicans and 43 Democrats)  22 are not returning to their seats (due to retirements or primary losses)  34 face general election opponents Texas House of Representatives

33.  New Lieutenant Governor (which also means new committee chairmanship assignments)  17 of 31 senators are certain to return to their seats (with Hegar and Van de Putte maintaining their seats and returning if their bids for others offices fail)  Could be as many as 8 new senators (meaning that one-third of the Texas Senate will not have served a full four-year term in the Senate in 2015) Texas Senate

34. Analysis from Mark P. Jones, chairman of Rice University's political science department

35.  14 Members of the Texas Senate were serving as legislators during the last special session on school finance (12 as senators and 2 as house members)  51 members of the Texas House were serving at the time. The Learning Curve

36. Percent with Majority Ch. 41 Legislative District Texas House Texas Senate

37.  Budget surplus (projected $2.5 - $5 billion)  But a Legislature unwilling to spend  $1 billion shortfall from Medicare needs  Transportation and water needs  Calls for tax relief  Property tax appraisals Issues at play

38.  Pre-Kindergarten  Debt Limitations & Transparency  TRS contribution  Virtual Schools  Teacher Quality  Accountability  Achievement School Districts  Private School Vouchers Education Issues at Play in 2015

39. Step in the process Possible timeline Judge Dietz files final judgment & findings of fact August 28, 2014 Appeal filed (30 days) September 26, 2014 Supreme Court takes caseOctober – December 2014 Briefings scheduledSpring 2015 Arguments before Supreme CourtMay 2015? Supreme Court issues final rulingSeptember/October 2015 Legislative response Spring 2016 (maybe 2017) Timing of the School Finance Case

40.  Since it is very unlikely that a school finance bill will pass in 2015, it is even more important to monitor what can be accomplished through the General Appropriations Act.  Basic Allotment: statutory floor of $4,765, but may be higher by appropriation ($5,040 in FY 2015)  Tier 1 Equalized Wealth Level (EWL): statutorily linked to Basic Allotment, so it increases when the BA does ($504,000 in FY 2015)  ASATR Reduction Factor: percentage set in appropriations (0.9263 in FY 2015)  Golden Penny Yield: increases with Austin ISD wealth per WADA  Tax Rate Compression Percentage: Established by appropriation Appropriations Levers

41. ASATR Over Time

42.  ASATR Reduction Factor, leading up to current statutory expiration in 2017  Increased property values  Increased Basic Allotment and Equalized Wealth Level The Decline of ASATR

43.  Secure suitable funding for public schools  Ensure funding for public schools remains with public schools  Provide local control for locally collected revenue Objectives for the 2015 Legislative Session

44. Secure suitable funding for public schools  Guarantee per-student funding for each school district to at least 2010 levels.  Reduce Robin Hood’s impact by increasing the State’s investment in education thereby keeping local dollars in local communities; create more “golden pennies” or raise the Basic Allotment and therefore the Equalized Wealth Level.  Protect the promise of Additional State Aid for Tax Reduction (ASATR) until another funding source is put in place to ensure that no school receives less revenue.

45.  Provide resources necessary to achieve reasonable state standards and expectations for college and career readiness.  Continue state assistance for new Teacher Retirement System (TRS) required contributions until such a time when adequate funding is provided by the school finance formulas. Secure suitable funding for public schools

46.  Oppose vouchers or any measure that would divert money away from public schools.  Support measures that empower locally-elected school boards with authority over local tax rates and revenue for the purpose of enrichment.  Increase flexibility for innovation and choices within public school districts. Ensure the funding for public schools remains with public schools Provide local control for locally collected revenue

47. How do we get there? The Abraham Lincoln Rule: “In the long run, legislative battles are not won in the halls of the legislature but in communities across the state.”

48.  Don’t suffer in silence  Provide personal experiences  Personal experience is the single most powerful factor that will influence how a legislator votes.  Tell your story & make it their story Effective Advocacy

49.  Credibility requires time – invest it now  Begin or strengthen personal relationships with legislators and staff  Invite legislators and staff to your district  Schedule meetings at their district office  Make personal phone call or write a hand-written note congratulating elected officials on their election/re- election after November 4 and offer your assistance during legislative session Between now and January

50.  Plan your visit to the Capitol to meet with legislators  Consider coordinating with other districts in your area  Let us help you! January 13 – March/early April

51. The Applause Meter The Intensity Meter Two Meters that Matter to Legislators

52. www.crcstx.org

54.  November 4, 2014 - Election Day  November 10, 2014 - Bill filing begins  January 13, 2015 – 84 th Session begins  June 1, 2015 – Sine Die 84 th Legislature - Dates to Remember

55. Election of Officers Mike Motheral Executive Committee Member

56.  President:  Kevin Brown, Alamo Heights ISD  Vice President:  Karen Rue, Northwest ISD  Secretary/Treasurer:  Scott Marshall, Sundown ISD Proposed Officer Slate

57. Thank you for attending!