CENTRAL TEXAS (KXAN) — Leander ISD and Pflugerville ISD voters will see Attendance Credit Elections on their Nov. 8 ballots.

For Leander ISD voters, Proposition A says: “Authorizing the board of trustees of the Leander Independent School District to purchase attendance credit from the state with local tax revenues.”

For Pflugerville ISD voters, Proposition A says: “Authorizing the board of trustees of Pflugerville Independent School District to purchase attendance credit from the state with local tax revenues.”

But what does this mean?

These ballot items are based on Texas education law that requires property-wealthy school districts to pay a portion of local tax revenue back to the state. This money is then shared with districts with a low property wealth in a process called recapture. Because of this, recapture is sometimes called “Robin Hood” as property-rich districts give money to property-poor districts through the state.

The propositions ask voters to allow the district to purchase attendance credits from the state as a way to pay its required recapture payments.

What is recapture?

Recapture was created in 1993 as a way to make school finances more equitable.

Texas lawmakers passed House Bill 3 in 2019, which redesigned Texas school district finances. One of the bill’s effects was reducing recapture and changing how it is calculated, according to the TEA.

Amanda Brownson, the associate executive director of policy and research at the Texas Association of School Business Officials, said school funding compares state funding to a cup. She said while some school districts’ cups overflow with property tax revenues, other districts’ property taxes fill their cup only partially. Then, state funding flows in to fill up the rest of their cup, she said.

“You can think of recapture as the state sort of compelling the district to send in the overflow of extra tax dollars,” Brownson said.

Districts whose local revenue exceeds its entitlement, which is how much funding a district is entitled to based on student enrollment, have five options to reduce their revenue level, Texas education law says. They include:

  • consolidation with another district
  • detachment of territory
  • purchase of average daily attendance credit
  • education of nonresident students
  • tax base consolidation with another district

The most common option is purchasing average daily attendance credit, which requires voter approval.

Brownson said Attendance Credit Elections are becoming more common as the number of recapture districts increased this year because property values increased more than the state expected.

What does a “for” vote mean?

A “for” vote means you are giving the district permission to make the recapture payment to the state, Brownson said.

Brownson said the state notifies districts in the summer whether they might owe recapture, and more information comes throughout the school year. In March, the state comptroller releases a preliminary property value study that gives the recapture amounts owed with more definite amounts in September.

Leander ISD said its estimated recapture payment is $31.2 million. Pflugerville ISD estimates its recapture to total about $11 million.

What does an “against” vote mean?

An “against” vote means the voter does not give the district permission to make a recapture payment to the state, Brownson said. If a majority of voters vote “against” the proposition, a portion of the district’s property tax base will be cut and given to a neighboring district. The Texas Education Agency would begin a “detachment of territory” process to remove a portion of the district’s property from its property values.

“So should the election fail, the state would move that property into a district with lower wealth levels, and the district would lose the benefit of having that property,” Brownson said. And, it means families may move to the reassigned district.

This would lead to lower property wealth in that original district and possibly a higher tax rate, Brownson said.

Brownson said a majority “against” vote has never happened in Texas, however.

Pflugerville ISD said it would lose $1.2 billion to $1.4 billion in its property tax base if the election fails. The district said it might raise its interest and sinking tax rate if this happens to continue the current debt schedule. In addition, students who live in the detached section of the district would attend the new school district, if this happens.

Leander ISD said it is in discussions with TEA to determine how much of its tax base could detach and said there is a lack of clarity on what detachment would look like.