Texas House Bill HB2168

Texas 2011 - 82nd Regular

• Introduced: 3/3/11
• Refer: 3/8/11

Caption

Relating to limitations on issuance by school districts of tax-supported bonds.

Impact

The implications of HB 2168 on state laws are significant, as it directly modifies the Education Code pertaining to financial management within school districts. By requiring that districts adopt a debt management policy and a capital improvement plan before issuing bonds, the legislation aims to ensure thorough fiscal oversight. This may help prevent excessive borrowing that could lead to financial instability. The measure also repeals existing statutory provisions that may conflict with the new regulations, thus creating a clearer framework for bond issuance in the context of public education financing.

Summary

House Bill 2168 introduces limitations on the issuance of tax-supported bonds by school districts in Texas. The bill establishes specific thresholds for local bonded indebtedness, which are set at 10% of the assessed property value for larger districts and 12% for those with student enrollments below 4,000. Additionally, districts experiencing significant enrollment growth over the past three years are allowed to increase their bonded indebtedness limit proportionally based on that growth. This will play a major role in how school districts finance capital projects through bonds, potentially impacting their ability to fund necessary improvements in facilities and infrastructure.

Sentiment

The sentiment around HB 2168 appears mixed among legislators and educational stakeholders. Proponents of the bill argue that establishing clear limits on bonded indebtedness will promote fiscal responsibility and transparency among school districts. They feel that this bill will protect taxpayer interests and ensure sound financial governance. Conversely, opponents express concern that the limitations may restrict districts' ability to pursue essential funding for facilities, particularly in areas experiencing rapid growth. The balance between fiscal prudence and the need for adequate funding in education is a focal point of the ongoing discussions regarding this legislation.

Contention

Notable points of contention include the impact of these restrictions on smaller and rapidly growing districts, which may struggle to finance expansions or improvements needed to accommodate increased student numbers. Critics raise alarms over potential unintended consequences that could arise from the new limitations, particularly in relation to extracurricular facilities. The debate encapsulates broader themes of local governance versus state control and the ongoing challenges in funding public education effectively in Texas.