Enrolled Bill Summary

            Senate Bill 4 amends Education Code, Government Code, and Tax Code provisions relating to school finance, school district property taxes, teacher salaries, social promotion, and other aspects of public education.

            Article 1 amends those codes' school finance provisions to increase both state aid to public school districts and total school district revenues as follows.

            Equalized wealth level. The act increases the maximum school district per pupil wealth allowed for equalization purposes to $295,000, continues a hold harmless provision that was set to expire after the 1999-2000 school year for districts affected by the cap, and indexes that provision to the increase in the equalized wealth level.

            The act allows a district that is required to reduce its per pupil property wealth, and that opts to contract with another district for the education of nonresident students in order to achieve that reduction, to include in its wealth reduction effort nonresident students who transfer into the district independent of an inter-district contract and who are not charged tuition. It also allows a district to pay tuition to another district for the education of its students and to apply the amount of tuition paid toward the cost of the option it chooses to reduce its per pupil wealth.

            Foundation School Program financing. The act increases the per pupil basic allotment to $2,537, increases the Tier 2 guaranteed yield level to $24.99, and bases the computation of the Tier 2 allotment on district tax rates for maintenance and operation purposes only. It also creates a new instructional facility allotment for operational expenses associated with opening a new school facility that provides a school district $250 per pupil in average daily attendance at a new facility in its first year of operation and $250 for each new student at the facility in the second year. The act caps appropriations for the new facility allotment at $25 million per school year. It also provides that a district otherwise ineligible for state aid under the Foundation school program is entitled to receive a new facility allotment or a credit against the cost of purchasing attendance credits under the per pupil wealth reduction provisions of Chapter 41.

            In addition to creating the new instructional facility allotment above, the act also increases the guaranteed yield level for the school facilities allotment created in 1997 to $35 per pupil per penny of tax effort, and it creates a separate guaranteed yield program to provide state aid for school districts with existing debt. Under the new program, a district is guaranteed at least $35 per pupil per penny of tax effort in state and local funds, with a maximum existing debt tax rate of 12 cents per $100 valuation, to pay the debt service on eligible bonds.

            Teacher salaries. The act amends the minimum salary schedule, provides districts additional state aid to provide a $3,000 salary increase for professional staff, places full-time counselors and nurses on the minimum salary schedule that previously applied only to classroom teachers and librarians, and requires districts to award the increases in actual pay in addition to any salary increases to which a teacher might be entitled as a result of any local supplement and any career ladder supplements the teacher would have received in 1999-2000 or 2000-2001. The act also includes a hold harmless provision to provide additional state aid for districts that experience additional salary costs as a result of the teacher pay raises that are not fully funded by an amount equal to 80 percent of the increases in Foundation School Program funding elements. The act sets the minimum days of service for an educator employed under a 10-month contract at 187 and deletes a previous provision that indexed the minimum days of service to increases in teacher salaries.

            Property tax relief. The act amends various Education Code, Tax Code, and Government Code provisions relating to school district property taxes. To the extent that funds are available, the act allows exclusion of one-half of local optional homestead exemptions granted by taxing units other than a school district in the determination of school district property values and requires the comptroller to certify a final value for each district computed both with and without such local exemptions. The act establishes a rollback tax rate for school district property taxes at three cents per $100 valuation above the sum of the base tax rate and debt tax rate for the 1999 tax year and six cents per $100 valuation above the base tax rate and debt tax rate for subsequent years. The base tax rate is a rate that provides a district the same amount of state and local maintenance and operations revenue per student, plus any increases due to changes in funding elements under the Foundation School Program. The act reduces tax rates in the 1999 tax year by computing the base tax rate using a Tier 2 guaranteed yield of $23.10 and compressing the base tax rate to generate the same amount of state and local revenue that districts would have received under a guaranteed yield level of $21. (Because a district will actually receive a guaranteed yield under Tier 2 of $24.99, not all of the increase is used for tax rate compression.)

            The act also extends indefinitely a hold harmless provision for districts that otherwise would have been adversely affected by decreases in school district property tax revenue as a result of the 1997 increase in the constitutional homestead exemption.

            Article 2 amends the Education Code to mandate and fund various programs to improve student performance to eliminate an educational practice known as social promotion.

            Social promotion. The act requires students in grades 3, 5, and 8 to pass certain statewide tests (the reading test in grade 3 and reading and mathematics tests in grades 5 and 8) before they are allowed to advance to the next grade. The act requires that students who fail a test be given additional opportunities to retake the test before the start of the next school year, and it requires school districts to provide students failing a test accelerated instruction in the subject area failed, in small groups having a ratio of not more than 10 students per teacher, after each administration of the test. For a student who fails a test a second time, the district is required to establish a grade placement committee consisting of the school principal or principal's designee, the student's parent or guardian, and the student's teacher in the subject area failed to prescribe the accelerated instruction to be provided before the student takes the test a third time. The act requires that a student who fails a test for the third time be retained at the same grade level unless the parent or guardian appeals the retention to the grade placement committee and the committee determines that the student is likely to perform at the next grade level given accelerated instruction on promotion. The act provides that for a student in a special education program who fails one or more of the tests specified for that student, including an alternative test, the student's admission, review, and dismissal committee will determine the manner of participation in accelerated instruction and make decisions regarding the promotion or retention of such student.

            For students in kindergarten or grade 1 or 2 who are determined to be at risk for dyslexia or other reading difficulties, the act requires each district to provide accelerated instruction in reading to students in kindergarten during the 1999-2000 school year, to students in kindergarten and grade 1 during the 2000-2001 school year, and to students in kindergarten and grades 1 and 2 during the 2000-2001 and subsequent school years. It also creates a grant program for school districts and open-enrollment charter schools to implement or expand kindergarten and prekindergarten programs, a grant program to provide an educational component to federal Head Start programs or other similar government-funded early childhood care and education programs, and a grant program to fund school district programs for students in grade 9 who are at risk of not being promoted to the next grade.

            Miscellaneous provisions. The act creates a Texas Troops to Teachers Program to help former military personnel obtain teacher certification and to facilitate employment of such persons by school districts experiencing teacher shortages. Applicants selected to participate in the program receive a $5,000 stipend. The act requires that preference be given to applicants who have significant educational or military experience in science, mathematics, engineering, or a field identified by TEA as important for state educational objectives.

            The act requires the commissioner to evaluate each district's disciplinary alternative education program on an annual basis and to include in the evaluation TAAS performance of students in those programs.

            The act also requires a school district employee serving as a head coach or chief sponsor of an extracurricular activity, including cheerleading, to be certified in first aid and cardiopulmonary resuscitation.