Webinar Series - The Property Tax-School Funding Connection

The property tax plays a key role in the funding of public education in the U.S. In 2015-16, about 45 percent of the total revenue supporting elementary and secondary education came from local governments, and 81 percent of the local share came from property taxes. A central tenant of education finance in the U.S. is local control. A robust role for local funding is important if local citizens, through their school boards or local referenda, are going to have a meaningful voice in the operation of local schools. The consensus among public finance scholars is that the property tax has many positive attributes as a local government tax.

However, most state legislatures have enacted a variety of property tax limitations—on the property tax base, on rates, or on revenues. So how do policymakers assure that there is adequate funding for public education while maintaining a significant degree of fiscal autonomy for local school districts?

This webinar series explores the experience of three states that have enacted various types of property tax limitations and the efforts taken to ensure continued adequate funding for public education. Presenters from each state assess the effectiveness of those efforts and suggest possible policy reforms to ensure adequate funding for public education on an ongoing basis.

Speakers:

Daphne Kenyon (Resident Fellow in Tax Policy, Lincoln Institute of Land Policy) introduces the series by describing the role of the property tax in funding public education over time and across the U.S. She also serves as moderator for the series.

Julie Underwood (Professor of Education Law, Policy, and Practice and former Dean of the School of Education, University of Wisconsin-Madison) describes Wisconsin’s approach to limiting school property taxes. She also describes the increasing role of school choice across the state.

Laura Ullrich (Regional Economist, Federal Reserve Bank of Richmond) describes South Carolina’s tax swap, enacted in 2006, which reduced local property taxes and increased the state’s reliance on sales taxes. The talk focuses on the impacts of this tax swap on public education and highlights the consequences of replacing a relatively stable revenue source with a less stable one.

Lynn Moak (Managing Partner, Moak, Casey & Associates [school finance consultants]) discusses property tax restrictions and school funding legislation enacted during Texas’ most recent legislative session (HB3 signed into law in 2019). In this presentation, he also assesses the ongoing school funding challenges that remain.

Participant Outcomes:

• Learn about how three states try to both provide adequate funding for K-12 education and appropriate property tax relief.
• Learn about policy pitfalls and model policies that relate to school funding and property tax relief.