From the Office of Senator Kel

Seliger Wednesday, April 26, 2006 Volume 1, Number 1

In This Issue Greetings from the • A Message from Kel Seliger Legislature! • Introduction to the Special Session To the Constituents of Senate District 31: • Property Tax Relief • Education Excellence Initiatives It is my honor and privilege to serve you in the . This is the first of what I hope will be regular e-newsletters sent to update you on the activities of the , especially on those issues most important to Senate District 31. As someone who lives and works in the District, your thoughts and opinions regarding matters of concern are essential to helping me best represent you. Please do not hesitate to call or email me if there is ever anything I can do for you. I hope you enjoy this newsletter, and I look forward to hearing from you.

Sincerely,

Kel Seliger

Introduction to the Special

Senate District 31 is made up of Session Andrews, Bailey, Cochran, Crane, The Texas Constitution grants the Governor the Dallam, Deaf Smith, Ector, Gaines, authority to call a special session of the Legislature that shall Glasscock, Hansford, Hartley, last no longer than thirty days. Hemphill, Howard, Hutchinson, The Governor issues a Lipscomb, Martin, Midland, Moore, proclamation, referred to as Ochiltree, Oldham, Parmer, Potter, the "call," that designates the Randall, Roberts, Sherman and subjects of legislation that the Yoakum Counties. Legislature can consider during the special session. The Governor may expand the call to include additional topics at any time.

The current special session convened on April 17, 2006, for the purposes of considering legislation to provide for school district property tax relief, to provide for modifications to the current business franchise tax, motor vehicle sales and use tax, and the cigarette tax and to provide appropriations to Contact Us the Texas Education Agency for the management of the public school system. State Capitol Office P.O. Box 12068 As is required by the Constitution, all tax bills Austin, TX 78711 considered will initiate in the House of Representatives. While (512) 463-0131 not currently on the call, various education excellence FAX: (512) 475-3733 measures have been proposed in both the House and the Senate. Amarillo District Office 410 S. Taylor, Suite 1600 Amarillo, TX 79101

P.O. Box 9155 Property Tax Relief Amarillo, TX 79105 (806) 374-8994 Our current public school finance system relies heavily FAX: (806) 374-4607 on local property tax revenue for funding our public schools. In November 2005, the Texas Supreme Court issued a long- Midland-Odessa anticipated ruling on school finance in the Shirley Neeley, Texas Commissioner of Education, et al. vs. West Orange-Cove District Office Consolidated Independent School District, et al. (West 1400 N. FM 1788 Orange-Cove) case, stating that property taxes levied by local Midland, TX 79707 school districts constitute a statewide property tax, which is (432) 563-0031 prohibited by the Texas Constitution. The ruling also included FAX: (432) 563-0653 a June 1 deadline for the Legislature to address this issue.

Big Spring District Office In anticipation of a special session on school finance, 401 Austin, Suite 101 the Governor appointed the Texas Tax Reform Commission Big Spring, TX 79720 (TTRC) and directed the panel to make recommendations on (432) 268-9909 how to reform the state's business tax structure and provide FAX: (432) 268-9899 significant property tax relief. After conducting a series of public hearings throughout the state, the TTRC produced a Email: plan to reduce property taxes by one-third to $1.00 per $100 [email protected] of valuation and permanently cap this rate at $1.30 by the 2007 tax year. To achieve this level of property tax www.seliger.senate.state.tx.us relief, the TTRC plan proposes to reform the state's franchise tax by

broadening the base of affected businesses and eliminating various loopholes that have allowed businesses to avoid paying into the system. The resulting tax rate would reduce the current franchise tax to 1/2% or 1%, depending on the type of business activity conducted, assessed on a business' margin. Businesses would be allowed to deduct either the cost of goods sold or employee compensation and would not be required to pay anything if total revenues are $300,000 and below. Sole proprietors or non-corporate general partnerships would be exempt.

The House of Representatives has initiated several pieces of legislation to address the various aspects of the TTRC plan. In addition to the franchise tax reform described above, legislation has been filed to raise the cigarette tax by $1 per pack, to ensure that sales tax paid on used automobiles is according to 80 percent of the book value of the vehicle, and to use a portion of the current state budget surplus. These measures are all needed to achieve property tax relief while ensuring a stable, long-term funding source for public education. Furthermore, they allow the Legislature to avoid raising other taxes such as the sales tax. As of today, these bills have either been passed or will be passed by the House by weeks end. The Senate will then begin deliberation of these measures. Helpful Links

Texas Legislature Online www.capitol.state.tx.us Education Excellence Initiatives

Texas Senate Many education excellence initiatives have been www.senate.state.tx.us proposed in both the House and the Senate. Legislation to be considered in the Senate includes a $2000 across-the-board Texas House of Representatives pay raise for teachers, nurses and counselors. I believe our educators should be paid in accordance with the national www.house.state.tx.us average, and I hope this is the first step to regular periodic

salary increases. Additionally, the same proposal includes Texas Tax Reform Commission district-based incentive pay plans for teachers who contribute www.ttrc.state.tx.us to increased student achievement, teach on hard-to-staff campuses or in shortage subject areas and who act as Office of Governor mentors. These incentives are intended to reward teachers www.governor.state.tx.us who put in additional time and effort both to better educate our children and to help newer, less experienced teachers learn to be more effective. Research has proven that new teachers who are part of a mentor program are 85 percent more likely stay in the teaching profession.

The Senate is also debating the merits of a $500 high school allotment to be used on initiatives to help decrease the state's overwhelming drop out rates. For example, the allotment could be used to set up non-traditional instructional schedules in order to better accommodate students who are at risk of dropping out. Currently, statistics show that one in three high school students are at risk, and we must work to address this growing problem with funding for non-traditional instruction and vocational programs.

Legislation that was filed in the House would update many of the formulas used to allocate funding to schools, such as the cost of education index and the transportation allotment. These formulas, many of which have not been updated in several years, help ensure that rural schools and small and mid-sized schools receive their fair share of state funding. The proposal would also phase in 98 percent equity over a six year period. If we do not address the equity issue we will only widen the gap between property rich and property poor districts, which would be detrimental to Senate District 31 and all of rural Texas.