Legislation addressing fraction funding issues under the Foundation School Program will be sent to the Governor’s Office for signature, following the Texas House’s approval of amendments to House Bill 7. Approval of amendments to HB 7 on the House Floor occurred during the weekend prior to June 1st, Sine Die for the 84th Session. Fractional funding issues affect about 46% of Texas school districts that had maintenance and operations (M&O) tax rates below $1.50 in tax year 2005 (school year 2005-2006).
Under the bill, a district with a compressed rate below $1.00 would be able to convert pennies equalized at the $31.95 yield to Tier 1 pennies until a full $1.00 Tier 1 rate is achieved, providing entitlement based on 100% of the basic allotment and a Tier 1 local share of $1.00. Conversion of Tier 2 pennies would be optional in fiscal years 2016 and 2017 and would be automatic beginning in fiscal year 2018. If a school district chose to participate, they would be required to notify the commissioner of education in writing not later than September 1 of the affected school year.
HB 7 is a 40 page bill that was amended extensively during the 84th Session as language was moved to it from various bills that were not moving forward. To access the text to House Bill 7, click on the link below.
http://www.capitol.state.tx.us/BillLookup/Text.aspx?LegSess=84R&Bill=HB7