The Right Way and the Wrong Way to Handle the State Revenue Crisis

Letters are going out to state legislators regarding the state budget.  Texas education will continue to fall way below the nation's average if more cuts are made.  The letter is below:

Destructive cuts in funding for education and other essential public services are not the answer to the state budget shortfall that confronts the 2011 legislative session. State funding for public schools already lags behind growth in enrollment, inflation, and the cost of meeting rising state achievement goals. Texas needs to invest more, not less, in the nearly five million children attending our public schools.

Destructive cuts in funding for education and other essential public services are not the answer to the state revenue shortfall that confronts the 2011 legislative session. State funding for public schools already lags behind growth in enrollment, inflation, and the cost of meeting rising state achievement goals. Texas needs to invest more, not less, in the nearly five million children attending our public schools.

To address the short-term revenue problems caused by the recession and avoid destructive cuts, I urge you to declare publicly your support for the full use of the state’s Rainy Day Fund. This economic stabilization fund is intended to counteract exactly the kind of economic downturn accompanied by revenue shortfalls that we are experiencing now. Fully using the $9 billion available in the Rainy Day Fund will go a long way to prevent needless harm to our state’s schoolchildren and their families.

There also are long-term, structural revenue shortfalls in the state’s finances that require long-term solutions. The 2006 bill that reduced school property taxes did not produce nearly enough replacement revenue. That bill at the same time made it much harder for elected school boards to raise revenue locally above $1.04 per $100 of value. The state also has exempted business and professional services from the state sales tax, leaving untaxed the main growth sector in the state’s economy. The legislature should rethink all these policies. Taxing most business and professional services (while preserving the exemption for “lifeline” services such as health care and child care) would raise $5.6 billion per biennium.

Please support the necessary and feasible short-term and long-term solutions to the state’s revenue problems and don’t shortchange the future–our schoolchildren.