House Bill (HB) 3, passed in the recent legislative session, made substantial changes to the District's recapture (Chapter 41) payment. Under HB 3, districts must reduce local revenue in excess of entitlement. Texas Education Code, Chapter 49. The Chapter 49 provision recaptures local tax dollars from property-rich districts and redistributes the funds to property-poor districts.

AISD is considered a property-rich school district. In FY2020, nearly 46 percent of all local revenue collected from property taxes will be subject to recapture. In FY2021, AISD anticipates the district will submit $606.3 million to the state in recapture funds. From FY2002 to FY2020, AISD will have paid the state of Texas more than $4.0 billion in recapture payments.

Figure 1: In FY 2020, AISD's recapture payment totaled $618.2 million. This reflects a 400 percent increase in recapture for the last few years. This payment is almost half of the district's annual budget of $1.6 billion.


Figure 2:  In FY2020, AISD paid $515 million more in recapture than other recapture districts in Region 13. AISD is the single, largest payer into the state finance system.

FY2021 General Fund including Recapture

Salary Related expenses (50 percent) and Recapture payments (41 percent) make up a combined 91 percent of the total FY2021 budget.  Professional and Contracted Services come in next at five percent, Supplies and Materials make up 3 percent; and Other Operating Costs are at one percent.

FY2021 General Fund excluding Recapture

Looking at the General Fund and excluding recapture, Salary Related expenses are at 85 percent of the fund. Professional and Contracted Services are at eight percent; Supplies and Materials make up five percent; and Other Operating Costs come in at two percent of the General Fund budget.