Houston Independent School District has a fight on its hands in the next legislative session. The state considers Houston a rich district, requiring it to share money in what's known as "recapture." This fall, voters rejected the most common way to pay, voting down Prop 1, so the state is looking for another way to pay off the bill. The State of Texas will try to take $18B worth of commercial, non-residential property away from HISD to pay off the bill.

“Our district and the business community have a lot at stake, and it’s no joke,” said Ashlea Graves, who directs governmental relations with HISD.

Graves told Houston Public Media that they have three top priorities when it comes to changing school finance:

• A local homestead exemption: School districts like HISD could get some credit in the finance formula for property that they don’t tax under the homestead exemption. This could save HISD about $60M in recapture money.

• Restore transportation money: HISD loses the state’s transportation funding just like every other property-wealthy district that pays into recapture. For HISD, it’s worth $12M.

• Count kids in full-day pre-kindergarten: Currently when Texas calculates the recapture bill, it doesn’t count these students as full-day. Graves said this would reduce the bill by about $39M.

If passed, these strategies would reduce HISD’s debt by about a $100M. [HPM]