Last year a column Taxpayers should do ‘homework’ on Temple ISD bond election analyzed TISD residents’ local debt ahead of a bond election on the May 2011 ballot. While that measure passed, local debt is becoming a more prominent public policy concern than even in 2011. The Belton Independent School District’s May 12 election seeking approval of a $60 million bond proposal presents a new opportunity to revisit this issue from a local standpoint.
Taxes, spending and debt – including the debt legacy facing future generations – are hotly debated national issues. These same concerns are often visibly absent as local governments continue soliciting support for a seemingly endless stream of projects, programs and other actions serving to increase the size/scope of government while failing to always demonstrate significant taxpayer benefit or other productive results.
As the national debt clock approaches $16 trillion ($50,000+ per citizen, $138,000+ per taxpayer), it’s easy to rail against a big-spending federal government yet few of us are even aware of Texas’ $322.3 billion of local debt (Texas Bond Review Board, Aug. 2011). That equates to more than $50,000 for a family of four and does not include $68 billion in unfunded public pension liabilities.
Of this $322.3 billion, 40 percent – almost $130 billion – is in interest payments alone. This is an important point as debt figures which include only principal tell only a misdirected portion of the story.
Total Texas local debt comprises public school districts accounting for $108 billion with city debt ($98 billion) following closely behind. Water districts ($49.8 billion), “other” entities ($33 billion), counties ($20.6 billion), community and junior colleges ($6.7 billion), and health/hospital districts ($6 billion) round out the categories.
In Belton, taxpayers currently face outstanding bond debt of $327,832,539 which includes $23.3 million from the city of Belton, $167.9 million from Bell County and $136.5 million from the Belton ISD. With Belton’s population 5.9 percent of Bell County’s total population, this equates to $9,317.19 of local debt per resident.
Concern over local debt is growing. The size of government and taxing/spending practices have long been issues important to Americans for Prosperity-Texas. Emphasis on these issues is now heightened as we travel the state delivering a Prosperity & Economic Freedom presentation that addresses, among other things, how local bond debt threatens current and future generations’ economic freedom.
Texas Comptroller Susan Combs stopped in Temple on a recent Texas tour to warn of downward financial pressures ahead as local communities see federal and state tax dollars diminish. Her concern over increasing bond debt included the idea that all bond initiatives placed on an election ballot should include the amount of current debt (principal and interest) held by the entity. That certainly would be an important voter education point as well as a positive move toward increased government transparency.
Through its Red Apple Project, Americans for Prosperity-Texas provides taxpayers with detailed statistics and financial information about Texas school districts. Some of the information comes directly from the Texas Education Agency. AFP’s message is simple: We want more education for our dollars. We spend too much money on non-instructional items and must make students the priority. We can cut education spending without eliminating teachers or classrooms.
The Red Apple Project information is an additional resource for taxpayers to use in making decisions regarding public school financing. Highlights of the most recent TEA Snapshot (2010) available online indicates Belton ISD having a 9.5 percent drop out rate against a 17.4 percent state average. Of 53.2 percent of students who took the ACT/SAT, 33.3 percent met the criterion (state average is 62.6 percent taking the test, 26.9 percent meeting the criterion).
While the state average is about 50 percent, Belton teachers represent 45 percent of total staff and on average make $9,385 less than support staff, $42,827 less than administrative staff (statewide teachers make $8383 less than support staff). The snapshot indicates 45 percent of revenue goes toward instruction against a 50 percent state average.
From economists to financial analysts to public policy specialists to Joe Public who understands the hazards of chronically spending more than you make, America’s unsustainable financial course is getting harder to ignore, its consequences are looming. Prudent voters must do their own homework to better understand the debt increase that each individual bond election brings to a community’s overall financial obligations – obligations put not just upon current taxpayers, but debt service to be inherited by generations to come.
Good public policy decisions made today will acknowledge the full context of a measure’s long-term impact and recognize tomorrow’s changing environment. Ronald Reagan said, “There are no easy answers, but there are simple answers. We must have the courage to do what we know is morally right.”
Taxpayers doing their homework regarding the range and implications of spending issues would seem a helpful place to start.
NOTE: Earlier this year, Americans for Prosperity Texas Director Peggy Venable spoke before a Belton audience on Prosperity & Economic Freedom and discussed our future prosperity from a worldwide, national and local perspective. Contact Lou Ann Anderson at info@EstateofDenial.com for a PowerPoint version of the information presented.
Lou Ann Anderson is an advocate working to create awareness regarding the Texas probate system and its surrounding culture. She is the Online Producer at www.EstateofDenial.com, a Policy Advisor with Americans for Prosperity – Texas and a Director of Women on the Wall. Lou Ann may be contacted at info@EstateofDenial.com.