HomeMy WebLinkAboutR-2004-08 oppose school finance or tax system reforms
RESOLUTION NO.
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A RESOLUTION OF THE CITY OF LA PORTE. TEXAS, OPPOSING ANY
SCHOOL FINANCE OR TAX SYSTEM REFORMS THAT WOULD NEGATIVELY
AFFECT CITY REVENUES AND ECONOMIC DEVELOPMENT EFFORTS
WHEREAS, it is likely that the Texas Legislature will address school finance and tax system
reforms in the near future; and
WHEREAS, during theses deliberations by the Texas Legislature, proposals to limit the ability
of cities to collect property taxes and sales taxes are likely to be offered by some members of the
Legislature; and
WHEREAS, additional restrictions on city taxes fly in the face of a history of frugal tax
administration by Texas cities; and
WHEREAS, all Texas cities combined collect only 15.3 percent of all property taxes collected
in the State of Texas, while schools collect more than 60 percent; and.
WHEREAS, between 1985 and 2002, the municipal share of all property tax revenue fell from
20.3 percent to 15.3 percent; and
WHEREAS, adjusted for inflation, municipal property taxes went up by only 37 percent
between 1985 and 2002, while population grew by 33 percent, demonstrating that growth in
municipal property tax levies roughly matched population growth; and
WHEREAS, Texas cities rely on tax revenue to build basic infrastructure, to ensure public
safety through police and fire departments, and to provide numerous essential services for city
residents, who are 80 percent of the state's population; and
WHEREAS, Texas cities engage in numerous economic development activities that produce
jobs and revenue for the entire State of Texas; and
WHEREAS, cities must meet the challenges of homeland security and compliance with state
and federal mandates, many of which are unfunded mandates; and
WHEREAS, Texas cities have shown over the years that they are fiscally responsible and good
stewards of taxpayers' money; and
WHEREAS, efforts to limit the ability of cities to collect sales and property tax revenues or to
set tax rates would have severe negative impacts on city services, city employees, economic
development efforts, and ultimately the citizens of the State of Texas;
WHEREAS, to the extent adverse actions are taken to the tax revenue stream, the City of La
Porte, Texas would be more adversely affected then the average Texas city.
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NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF LA PORTE, TEXAS:
That the governing body of the City of La Porte will oppose all school finance or tax reform
efforts by the Texas Legislature that negatively impact the ability of the City to provide basic
essential services, conduct economic development activities, and ensure public safety by limiting
our ability, beyond the provisions of current law, to collect property tax or sales tax revenues.
PASSED AND ADOPTED this~ay of March 2004.
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Mayor, City of La Porte. Texas.
ATTEST:
APPROVED AS TO FORM:
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REQUEST FOR CITY COUNCIL AGENDA ITEM
FiAllac:e
ADDroDriation
Agenda Date Requested:
Requested By:
Source of Funds:
N/A
Department:
Account Number: N/A
Report:
Resolution: XX Ordinance:
Amount Budgeted: N/A
Exhibits:
Amount Requested: N'A.
Exhibits:
Budgeted Item: YES
NO
Exhibits:
SUMMARY & RECOMMENDATION -
School finance reform poses serious threats to city tinances. In August 2003 the Texas Municipal League (TML)
appointed a Task Force to study the impact of school Finance reform on Texas cities. Since that time, we have
provided you with information substantiating our concerns regarding the impact on municipal revenues, specifically
as it relates to the City of La Porte.
Governor Rick Perry is expected to call a special session of the Texas Legislature next month to address the state
funding formula for schools. The primary way in which possible reform scenarios could hurt cities is by taking
revenue from property or sales taxes and diverting it to schools.
We are especially vulnerable, since 71 % of our revenues are derived from this combined stream, compared to 56%
for the average Texas City. To the extent adverse actions are taken to this revenue stream, we would have an
additional exposure of 15%.
In the area of Economic Development, these type actions could cripple economic expansion efforts. When sales
taxes go down, so do Section 4B Sales taxes, and our associated opportunities to attract new businesses.
The Resolution that we are asking you to pass opposes any system reforms that would negatively affect city
revenues and Economic Development efforts,
Action Required bv Council:
Adopt/approve resolution opposing any School Finance or Tax System Reforms that would negatively affect City
Revenues and Economic Development efforts.
3-; ft; -oV
Date