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Great Events from History: Human Rights, 2nd Edition

Texas’ Method Of Funding Public Schools is Ruled Unconstitutional

by Glen E. Thurow

1989

Large disparities in school funding between rich and poor districts in Texas were ended by a Texas Supreme Court decision and subsequent legislative action

Category of event: Educational rights

Time: October 2, 1989

Locale: Austin, Texas

Key Figures:

Oscar Mauzy (1926-2000), the chief justice of the Texas Supreme Court who wrote the opinion declaring that the Texas system of financing schools violated the Texas constitution

F. Scott McCown (1955- ), a Texas district judge who ruled that the school finance reform legislation of 1990 did not establish sufficient equality

William Clements (1917-2011), a Republican governor of Texas who insisted that a school funding bill not result in a tax increase

Ann Richards (1933-2006), a Democrat who won the Texas governor ship in 1990

Gibson Lewis (1936- ), a Democratic speaker of the Texas House of Representatives, led the legislature to school funding reform

Summary of Event

Since the development of its public school system, Texas had financed its schools largely through local property taxes. These taxes were raised at the local level and spent on the local school system. Substantial amounts of state aid provided a minimum level of funding for every school district, but local districts were free to supplement these funds from local property taxes. Even though the level of state funding increased over the years, schools remained heavily dependent upon money raised through local property taxes. School districts could levy taxes and spend the tax money how they wished, limited only by broad state parameters.

The result of this system was that property-rich districts had a much greater ability to fund their school systems than did property-poor districts. In 1989, the one hundred wealthiest districts had twenty times the property wealth of the one hundred poorest districts. These wealthy districts could either have much lower taxes than the poor districts or could spend much more on their schools. Typically, they did both. It was not unusual for a property-rich district to have both lower taxes and ten times the amount of discretionary money per pupil possessed by a property-poor district.

This resulted in considerable disparities in the education provided to children within the state. In some of the state’s poorer districts, schools lacked such ordinary aspects of a good education as science teachers and labs, gymnasiums, or cafeterias. The problem was compounded by the fact that spending on education in Texas was among the lowest in the nation. While there were great differences within the state, even the wealthiest districts tended to fall below the national average in terms of perpupil expenditures.

Texas’ system of financing education was first challenged at the federal level in the early 1970’s. In 1973, the case of San Antonio v. Rodriguez reached the U.S. Supreme Court. In it, the Edgewood Independent School District, a property-poor district in San Antonio predominantly composed of African Americans and Mexican Americans, argued that the funding system violated the equal protection clause of the Fourteenth Amendment to the U.S. Constitution.

The high court rejected this argument, finding that the system did not violate the U.S. Constitution. The Court found that the system did guarantee to all children a minimum level of education through state-supplied aid. It held that even if education could be considered a right (which it doubted), the Court did not have the authority to guarantee people levels of education beyond the minimum. The Court also found it difficult, using its traditional “equal protection” analysis, to determine a class of people who were the object of discrimination. It pointed out that poor people often did not live in poor districts, and poor districts often contained rich people.

The heart of the Court’s opinion, however, was a concern for local control of education. It praised the freedom for political participation, experimentation, innovation, and healthy competition that local school control facilitated. Centralized control of the money, it thought, would inevitably mean centralized control of education and a consequent loss of local freedom.

Having lost on the national level, the Edgewood district turned in the 1980’s to the Texas state constitution for relief. Joining with other poor school districts, and represented by the Mexican American Legal Defense and Educational Fund (MALDEF), suit was brought in May, 1984, against the state of Texas. The suit alleged that the state’s school finance system discriminated against students in poor districts in violation of the Texas constitution. Partly as a response to this suit, the state legislature passed a school reform law in June, 1984, that substantially increased state aid to poorer districts. The suit was reconstituted and continued, however, on the grounds that there were still large disparities between rich and poor districts.

In January, 1987, a state district judge ruled that the financing system did indeed violate the Texas constitution. This decision was overturned by the Third Court of Appeals in Texas, but its decision was in turn appealed by MALDEF to the Texas Supreme Court. On October 2, 1989, the three Republican and six Democratic judges on the Supreme Court of Texas voted unanimously that the school finance system was unconstitutional. The court ordered the legislature to design a new system in time for the 1990-1991 school year. Speaking through Chief Justice Oscar Mauzy, the court held that the Texas constitution required that there be “substantially equal opportunity to have access to educational funds.” There must be equal educational opportunity for children “regardless of where they live.” What had been lost on the federal level was now won on the state level.

There ensued a fierce political battle in the Texas statehouse. Republican Governor Bill Clements insisted that the funding problem posed by the court should not be met by increasing state taxes. In addition, representatives from districts which stood to gain were pitted against those who stood to lose. The legislature met in four special sessions during the spring of 1990 to hammer out a new system. After three special sessions, the legislature agreed to a bill, only to have it vetoed by the governor because it raised taxes. After the governor’s veto, a court-appointed master threatened an alternative “Robin Hood” plan that would shift hundreds of millions of dollars of tax dollars from wealthy to poor school districts. Under this threat, the governor and the legislature reached a compromise which attempted to solve the problem by increasing state aid to education but left substantial discretion to local districts to raise additional funds.

MALDEF and the poor school districts, however, challenged this solution in court as not providing sufficient aid for the poor districts and failing to make expenditures in all districts equal. In September, 1990, State District Judge Scott McCown agreed, ruling that the new law was unconstitutional because it did not give all schools “substantially equal” access to funds for a similar tax effort. Rather than order a new plan, the judge gave the legislature another year to come up with a plan that met this criterion.

In the November election of 1990, Ann Richards, the Democratic gubernatorial candidate, recaptured the statehouse from the Republicans. Because the Democrats already possessed solid control of the legislature, party conflict became less of a factor when the legislature reconsidered school finance in the spring of 1991. This did not prevent another fierce political battle over who would bear the burden of the reform. The new governor took a relatively small part in the legislative negotiations that led to the passage of a variation of the “Robin Hood” plan in early April. The plan established minimum and maximum taxing levels, designed to force increased spending on schools over a four-year period. It guaranteed similar funds for similar taxing efforts by a combination of transferring property tax revenue from wealthy districts in a county to poor districts, increasing state aid for poorer districts and decreasing it for wealthier ones, and placing spending limits on the wealthiest districts. The end result of court and legislative action was a substantial change in the Texas educational system. Many suburban and city districts faced a loss of revenue; many rural and poorer districts near cities could look forward to substantially increased funding. Spending per pupil would now be roughly equal across the state.

Significance

The long-term effects of the court-ordered change in Texas education would take some time to work out. The hoped-for improvement in the education in poorer districts would depend upon translating the increased dollars available into better education for children. Better teachers could be hired, and better facilities built. This seemed a likely, but by no means guaranteed, result. The plan also faced court challenges from wealthier districts, which alleged that it violated the Texas constitution by requiring shifts in property tax revenue from the district in which they were raised to other districts.

The immediate impact was felt most strongly by those school districts which faced a decrease in state aid or a transfer of their property taxes to other districts. These included middle-and upper-class suburbs and large cities. To indicate the scope of these shifts, five suburban school districts around Dallas were required to shift property tax revenue to other districts, and two additional districts, including the city of Dallas, lost substantial amounts of state aid. The districts responded by laying off teachers and constricting their curricula. Typical cuts included foreign language instruction, honors classes, and other elements of the curriculum that enabled students to advance beyond the “basics.” It was clear that the “best” Texas schools would no longer be quite so outstanding.

Large cities faced particularly severe problems. The city of Dallas lost half of its state aid because of its large property base. Ironically, the city’s schools were simultaneously faced with the possible loss of accreditation because of inadequacies in the system. Within the Dallas system were some of the poorest and most difficult neighborhoods for schooling in the state. The court’s insistence upon equality did not consider that the complex problems of today’s cities make it more expensive to provide the same quality of education delivered in a rural district.

The change also brought about a new level of bureaucracy in the state’s school system. To equalize tax revenue among local school districts, new countywide taxing districts were created to supplement the local districts. These required boards to decide how to levy and distribute taxes, and staff to administer the boards’ decisions. An increase in administrative costs and regulation was the inevitable result.

Thus, the decision of the Texas Supreme Court led to mixed results. On one hand, there was a prospect of improved education for children in poor districts. On the other, the best schools were hurt, local initiative was diminished, hard-pressed cities were left with decreased funds, and an already large educational bureaucracy was expanded. There was a strong possibility that the education of some would be improved, but only at the cost of dragging others down, achieving universal mediocrity.

Bibliography

1 

Areen, Judith, and Leonard Ross. “The Rodriguez Case.” The Supreme Court Review 1973 (1973): 33-35. An interesting analysis of the problems of wealth and equal protection, focusing on the national case involving Texas school finance.

2 

Coons, John E., William H. Clune III, and Stephen D. Sugarman. Private Wealth and Public Education. Cambridge, Mass.: Harvard University Press, 1970. The seminal work advancing the view that school districts should receive a fixed amount of revenue per pupil for any particular level of tax effort regardless of the level of the property tax base.

3 

Pritchett, C. Herman. “The New Due Process—Equal Protection.” In Constitutional Civil Liberties. Englewood Cliffs, N.J.: Prentice-Hall, 1984. A good summary of the legal thinking about equality that lay behind the Texas Supreme Court decision about school financing, including a succinct discussion of the treatment of wealth by the U.S. Supreme Court.

4 

Richards, David A. J. “Equal Opportunity and School Financing.” University of Chicago Law Review 32 (1973): 41. A thorough discussion of the legal and constitutional issues that can be raised about the financing of schools through the local property tax.

5 

Tocqueville, Alexis de. Democracy in America. Translated by George Lawrence and edited by J. P. Mayer. New York: Harper & Row, 1988. The best analysis of the tension between the pursuit of equality and the pursuit of freedom in America.

See Also: Spanish Becomes the Language of Instruction in Puerto Rico (1949); Brown v. Board of Education Ends Public School Segregation (1954); The United Nations Adopts the Declaration of the Rights of the Child (1959); Head Start Is Established (1965); Congress Enacts the Bilingual Education Act (1968); The Supreme Court Rejects Racial Quotas in College Admissions (1973); Congress Passes the Child Abuse Prevention and Treatment Act 1974; Congress Enacts the Education for All Handicapped Children Act 1975; Southern Schools Are Found to Be the Least Racially Segregated (1975); The United Nations Adopts the Convention on the Rights of the Child (1989).

Citation Types

Type
Format
MLA 9th
Thurow, Glen E. "Texas’ Method Of Funding Public Schools Is Ruled Unconstitutional." Great Events from History: Human Rights, 2nd Edition, edited by Tina M. Ramirez, Salem Press, 2019. Salem Online, online.salempress.com/articleDetails.do?articleName=GEHR2E_0447.
APA 7th
Thurow, G. E. (2019). Texas’ Method Of Funding Public Schools is Ruled Unconstitutional. In T. M. Ramirez (Ed.), Great Events from History: Human Rights, 2nd Edition. Salem Press. online.salempress.com.
CMOS 17th
Thurow, Glen E. "Texas’ Method Of Funding Public Schools Is Ruled Unconstitutional." Edited by Tina M. Ramirez. Great Events from History: Human Rights, 2nd Edition. Hackensack: Salem Press, 2019. Accessed December 14, 2025. online.salempress.com.