AUSTIN— While most taxpayers are focused on the $16 trillion federal debt, few Texans realize that local governments have amassed over $322 billion in debt. One-third of that is public education debt.
A new report issued by Texas Comptroller Susan Combs titled “Your Money and Education Debt” will provide insight into debt issued by public schools, community colleges and universities.
“Local government debt is one of the most pressing issues facing Texas. This report is a breath of fresh air for taxpayers,” said Peggy Venable, Texas director of Americans for Prosperity-Texas. “The Comptroller points out that present day debt commitments will continue to affect Texans for decades. “
Venable said, “Texas is second only to California, the Greece of America, in local government debt. We are mortgaging our children’s future.”
Public education debt per student has grown at a rate of four times faster than inflation. The report reveals that per student debt in Texas is $13,334. Current and future taxpayers are responsible.
The largest expenditure in public education is debt service, which increased over the past 10 years at twice the rate of ISD’s payroll. Debt service rose by 127 percent while overall expenditures grew 64 percent.
Per student debt increased most among slower enrollment growth districts. Debt increased 257.6 percent in those districts compared to 138.4 percent growth in the fastest-growth districts.
The most rapid debt service growth occurred immediately following the legislature providing property tax relief.
Public universities have issued almost 43 percent of the state’s debt with the University of Texas System holding the most in outstanding debt at $7.3 billion or $35,000 per student, almost two times as much as Texas A&M University System. But, the University of Texas System debt includes medical schools.
Recommendations are made for greater public transparency and cost-savings.
“We at AFP support the recommendations made by the Comptroller,” said Venable. “We will encourage legislators to embrace these common-sense taxpayer protections. “
Among the recommendations providing full transparency for all funding sources for universities, recommending incentives for use of architectural prototypes in the construction of new educational facilities.
Education delivery is evolving as education is entering a digital revolution, which will include wider adoption of online learning and electronic textbooks. Innovations may not eliminate the need for traditional school campuses but the size and number of facilities needed in the future will likely change.
The report is available online at www.TexasItsYourMoney.org. The earlier report on local debt is available here.