This afternoon, we attended the Texas Public Policy Foundation's forum on Local Government Transparency and Debt; the following are from our notes.
James Quintero, director of TPPF's Center for Local Governance, spoke first:
- Texas currently has $192 BILLION in principle and 96 BILLION in interest in local government debt outstanding.
- Living beyond our means only works for a limited period of time.
- 83% of total public debt in Texas is local.
- Local Government debt has risen approximately 40% faster than inflation plus population growth in the last decade.
- Sources of Debt:
- School Districts -- $63.6 BILLION
- Cities -- $62.9 BILLION
- Special Purpose Districts (eg. Hospital Districts or MUD's) -- $48.6 BILLION
- Counties --$13.3 BILLION
- Community Colleges -- $4.3 Billion
- Texas currently has the 14th highest property taxes in the United States; to get a handle on that, we have to get a handle on local government debt.
- Local government debt is a long-term threat to the Texas Model.
- Positive state policy decisions don't filter down to the local level.
- How to fix it:
- Public Awareness
- Ballot Box Transparency
- Online Transparency
- Local Government Debt Limits
Bennet Sandlin, Executive Director of the Texas Municipal League, spoke next:
- Led off by passing the buck to the state government.
- Local governments get the bulk of their money from property taxes; State gets it from sales....
- A big chunk of property taxes go to schools.
- Taxpayers get a "good bang for their buck" from municipal governments
- Keep in mind, school and special purpose districts AREN'T INCLUDED in these numbers; while this is a money-laundering shell game, Sandlin still makes a decent point regarding the expenditures of municipal governments narrowly defined.
- Special Purpose districts are the biggest driver of debt growth. They grew by 244% from 2007 to 2011. Unfortunately, in 2011 the clowns in the Republican leadership of the Texas Legislature exempted special purpose taxing districts from tracking.
- Sandlin argued that everything that happens in local governments (except schools) should be handled by cities, not special purpose districts; we tend to agree.
Pam Waggoner, President Leander ISD:
Leander ISD has one of the highest debt loads in the state, which Waggoner's only noted in passing. Her presentation moved extremely quickly and involved a lot of complicated numbers that made our eyes glaze over. Personally, we think this was her strategy.
Representative Dan Flynn (R - Canton)
- Local government debt is as big a threat to our economy as debt at the Federal level
- His bill was killed in Calendars.
- The permanent school fund has guaranteed more debt that cash on hand.
- 20 school districts in Texas owe over $2 BILLION