A fascinating legal fight is shaping up in Texas, where 63 school districts have filed suit against the state, charging that its method of funding schools in unconstitutional.
The lawsuit includes the largest districts – Austin, Houston and Dallas. More than 3 million students are enrolled in the districts.
"The issue, according to the lawsuit, is that the state has run afoul of the Texas Constitution by failing to provide adequate resources to meet the higher academic standards established by the Legislature," writes the Austin American-Statesman. "At the same time, districts lack "meaningful discretion" to set their own tax rates, as the courts have said is required. Finally, the system for divvying up the limited state dollars among the districts is inequitable and arbitrary."
In a statement issued by the plaintiff's attorneys, they argue that a temporary finance system approved by the Texas legislature in 2006 has become a "permanent funding system that assigns different levels of money to students in different school districts without regard for the actual costs of educating a growing and increasingly diverse and poor student population."
The lawsuit should be closely watched here in Indiana. My colleague, Dan Stockman, reported in August on Indiana property tax rate inequities that allow wealthier school districts to raise much greater amounts of money with a lower tax rate than poorer districts can raise with a higher rate. Statewide tax revenues cover general fund costs in Indiana, but school districts can ask voters to contribute more locally through a general fund referendum. Indiana is inevitably headed to a system of rich schools and poor schools.