The AISD board of trustees approved a tax rate of $0.9252 per $100 valuation at a Sept. 25 meeting. Additionally, the board voted to continue offering a partial tax exemption for historical landmarks.
The overview
The board approved a maintenance and operations, or M&O, tax rate of $0.8022 per $100 valuation, which is $0.0253 lower than the FY 2024-25 M&O tax rate of $0.8275 per $100 valuation.
The interest and sinking, or I&S, tax rate will remain at $0.123 per $100 valuation, making for a combined tax rate of $0.9252 per $100 valuation.
The M&O tax rate funds the day-to-day operations of a district, including salaries, benefits and operational costs, while the I&S rate may only be used to repay debt.
Voters approved a $0.091 property tax increase for a tax rate of $0.9505 per $100 valuation through the district’s voter-approval tax rate election, or VATRE, in November 2024 that affected the fiscal year 2024-25 rate. District officials said the $41 million in additional revenue from the VATRE would go toward pay raises, operating expenses and balancing the budget deficit, according to previous Community Impact reporting.
In a Nov. 4 election, Texas voters will decide whether to raise the statewide homestead exemption from $100,000 to $140,000. If approved, an AISD homeowner with an average taxable value of $517,514 would be expected to pay $3,493 in annual property taxes, which is a $864 decrease from the previous fiscal year.
If the homestead exemption increase is not approved, AISD homeowners are projected to see a $494 decrease in their annual property tax bill, according to AISD information.
Also of note
The board voted to continue offering a partial tax exemption to historical landmark properties that are recommended by the city’s Historical Landmark Commission.
The district ordinance was first adopted in 1979 and amended in 1994, 2005 and 2012, according to district documents.
Did you know
AISD is projected to receive nearly $1.5 billion in local property tax revenue in FY 2025-26. The district is expecting to send about $715.5 million of these local tax dollars back to the state through a process known as recapture.
Under recapture, also known as Robin Hood, the state collects excess local revenue from property-wealthy school districts and redistributes those dollars to property-poor districts.
As the state’s highest-paying recapture district, AISD has seen its budgeted recapture payment increase from $181.1 million in the 2014-15 fiscal year to $900.9 million in the 2022-23 fiscal year, according to AISD information. This comes as AISD experienced rising property values amid declining enrollment.
The district’s recapture payment dipped to $664.8 million in 2023-24 when voters approved increasing the homestead exemption from $40,000 to $100,000.
In case you missed it
In July, AISD adopted a $1.58 billion operating budget with a $19.7 million shortfall for fiscal year 2025-26.
The district reduced its initial shortfall projection of $127 million after proposing $44 million in budget reduction strategies, including $9 million in additional state funding following the 2025 legislative session. AISD is expecting to receive $45 million in revenue from selling the former Brooke and Rosedale elementary campuses, according to district documents.
Stay tuned
AISD is aiming to eliminate around 8,600-13,100 vacant seats to realize $30 million in savings through its school consolidation process.
The district will post the recommended school consolidation plan on its board documents website Oct. 3, an AISD spokesperson told Community Impact.
