Breaking it down
The $0.8322 rate is broken down into:
- $0.7122 for maintenance and operations, which funds the district’s day-to-day operations
- $0.12 for interest and sinking, which pays off the district’s debts from construction and capital improvement projects
The rate was calculated based on the certified property values provided by the Travis Central Appraisal District in July.
Something to note
EISD has already adopted the eight available golden pennies to help generate additional revenue, but many districts in Texas are considering adopting copper pennies, Chief Financial Officer Chris Scott said.
Adopting copper pennies requires a voter-approved tax rate election, or VATRE, and if approved, increases the M&O tax rate to generate additional funds.
However, copper pennies—unlike golden pennies—are subject to recapture. If EISD were to adopt the nine available copper pennies, the district’s tax collection would increase by about $20 million, but $16 million of that would be sent back to the state, Scott said.
On the I&S side, the rate must be set at a level that can pay off the district’s debt service. The $0.12 rate is “plenty” for EISD, Scott said, but would have to be increased if the district sold more bonds than what 12 cents could service.
This could come into play as the board considers recommendations made by the Long-Range Facility Planning Committee, which could require a bond election.
“Are we interested in [raising that rate] or not?” Scott said. “If we’re not, what are we capable of doing with 12 cents?”
