BONUS: The Texas Two-Step: What $8.5 Billion Bought
This is an unplanned addition to the series. HB2 was the cover to divert $1B to private schools. Here’s how it worked.
The day Texas passed its school voucher bill, lawmakers also passed another bill.
They needed to.
The coalition Governor Abbott had rebuilt after the 2024 primaries wasn't unanimous. Some Republicans who had replaced the rural holdouts were still uneasy. They needed something to point to. Something that let them go home to their districts and say: we didn't abandon public education. We invested in it.
That something was House Bill 2.
Speaker Dustin Burrows gave the pairing a name. He called it the Texas Two-Step: a voucher program on one foot, a school finance bill on the other. Two bills, passed the same day, framed as a package. The argument was simple. You can't say we hurt public schools when we also gave them the largest school funding increase in Texas history.
The argument was effective.
What it wasn't was accurate.
The Headline
HB 2 carries an $8.5 billion price tag. That number is real. Leadership has repeated it in press releases, signing ceremonies, and talking points. It's, by the numbers, a substantial appropriation.
The question is what that $8.5 billion actually delivered when it reached a classroom.
The answer lives in a single line of the Texas school finance formula: the basic allotment.
The basic allotment is the base amount of money the state guarantees per student before any additional weights are added for special education, bilingual learners, or career programs. It's the foundation of the entire formula. When lawmakers want to put flexible money into every district in the state, raising the basic allotment is the cleanest way to do it.
HB 2 raised the basic allotment by $55.
From $6,160 per student to $6,215. That's what the Texas Two-Step delivered to the base of the public school funding formula.
Fifty-five dollars.
And that number hadn't moved since 2019.
| Basic Allotment | Per Student |
|---|---|
| Before HB 2 (unchanged since 2019) | $6,160 |
| After HB 2 | $6,215 |
| What inflation required | $7,100 to $7,500 |
Education groups including Every Texan, Raise Your Hand Texas, and the state's major teacher organizations testified during the session that just keeping pace with inflation since 2019 would require a basic allotment somewhere between $7,100 and $7,500 per student. The $55 HB 2 delivered doesn't close that gap. It barely acknowledges it exists.
And there's one more thing about that $55.
It wasn't new money.
Keller ISD's legislative update, walking district administrators through the bill's mechanics, confirmed it directly: the basic allotment increase was funded by redirecting the golden penny yield, dollars that would otherwise have flowed through a different part of the formula. The state didn't add new money to the foundation of public school funding. It moved existing dollars from one pocket to another and called it historic.
Midway ISD superintendent Chris Allen said plainly what many superintendents were thinking: HB 2 "fails Texas students."
The Texas Observer reported that superintendents across the state slammed the Senate's version of the bill, describing the actual per-student base funding increase as wholly insufficient to address inflation and the rising cost of mandated programs.
The Raises
The bulk of HB 2's money went toward teacher pay. Approximately $4.2 billion is directed at compensation increases, and that investment is real. But how it was built matters as much as the total.
HB 2 doesn't give Texas teachers an across-the-board raise. It creates a set of targeted allotments tied to years of experience and district size. Significant portions of the workforce were left out entirely.
| Experience | Large District (5,000+) | Small District (under 5,000) |
|---|---|---|
| Fewer than 3 years | $0 | $0 |
| 3 to 4 years | $2,500 | $4,000 |
| 5 or more years | $5,000 | $8,000 |
A first-year teacher gets nothing from the primary raise mechanism. A veteran in a large urban district gets $5,000. A veteran in a small rural district gets $8,000.
Those aren't trivial amounts. But they're not the universal, predictable, salary-schedule-embedded raises that Texas teachers and their organizations had been asking for. Texas AFT, ATPE, and TSTA all pushed for raises built into base salaries, available to every educator, not concentrated in specific experience bands and subject to local implementation decisions.
What Texas teachers received is a targeted stipend structure.
What they asked for was a floor.
The step that gets bigger
This is where the Two-Step stops looking like a balance.
HB 2 funds specific programs and allotments for the current biennium. What it doesn't have is a growth engine. The basic allotment isn't indexed to inflation. The teacher allotments don't automatically grow with enrollment or rising costs. Future legislatures will decide whether to increase, maintain, or quietly let these investments erode.
TEFA works differently.
| Year One | Projected Next Biennium | |
|---|---|---|
| TEFA (vouchers) | $1 billion | $6+ billion |
| HB 2 (public schools) | $8.5 billion | No automatic growth |
The voucher program's own fiscal note projects it could grow to more than $6 billion in the following biennium. That's not an estimate from opponents of the program. That's the bill's own financial analysis. TEFA has a built-in growth path tied to participation. Every new family that enters adds to the obligation. Every future expansion of eligibility accelerates the cost.
HB 2 doesn't work that way.
Every Texan, in testimony before the Senate Committee on K-16 Education, made the trajectory explicit: HB 2 leaves per-student funding gaps unaddressed, especially given the new voucher obligations created by SB 2. Raise Your Hand Texas reached the same conclusion: the voucher program's growth could deepen public school funding challenges if future legislatures don't significantly increase formula funding.
No major Texas outlet has argued that HB 2 closes the gap created by SB 2. The consistent finding is that it partially offsets long-term underfunding but isn't built to keep pace with a voucher program designed to scale.
The Deal
The Texas Two-Step was designed to answer a question: how do you pass a school voucher bill in a state where most children attend public schools and teachers vote?
You pass another bill the same day. You put a headline number on it large enough to crowd out the fine print. And you call it historic.
The fine print: $55 per student in new base funding. Not new money. Raises that don't reach teachers with fewer than three years in the classroom. An $8.5 billion investment with no engine for growth, running alongside a voucher program built to take more and more public money.
The voucher pays $10,474 per student each year to private schools.
The Two-Step delivered $55 per student to public schools.
I've spent fourteen years in a Texas classroom. I know what $55 doesn't buy. And I know what draining public schools of funding actually costs.
In the final post of this series, we look at where this is all headed: what the trajectories of voucher programs in Arizona, Indiana, and North Carolina tell us about what Texas families and Texas public schools should expect in the years ahead.
