Clear Creek ISD's preliminary fiscal year 2022-23 budget plan shows a tentative reduction of its annual tax rate.

The CCISD board of trustees received a presentation from Chief Financial Officer Alice Benzaia at a regular June 27 meeting. Benzaia covered the preliminary tax rate and budget plan, which is yet to be finalized and approved.

According to Benzaia, the total tax rate for FY 2022-23 will tentatively be about $1.16 per $100 valuation, a decrease of about two pennies from the previous year at about $1.18. The tax rate has seen reductions each year since 2018, when it stood at $1.40.

Under the tentative rate, the owner of a $300,000 home would pay about $3,477 in property taxes to CCISD, a savings of about $60 from the approved FY 2021-22 rate.

Certified tax values are set to be received by appraisal districts July 25, and by the end of July the proposed tax rate will be published. Until the Texas Education Agency sends an approved maximum compressed tax rate, the rate is subject to change.

In May, two Texas property tax propositions passed. The first proposition was set to reduce the property tax limit for elderly and disabled residents. CCISD was held harmless, meaning the district’s funding will not be affected by the change.

The second proposition increased a state-mandated homestead exemption for school district property taxes from $25,000 to $40,000 per year. The district is mostly held harmless for this proposition.

For example, for a home with a taxable value of $300,000, the state-mandated homestead exemption would cause a $472 decrease in property taxes per year. Additionally, the CCISD optional homestead exemption reduces an additional $15,000 in taxable value, resulting in an additional decrease of $177 in taxes. Estimates are based on the FY 2021-22 tax rate and are according to Benzaia’s presentation.

School districts are funded primarily with local taxes and state revenue: As funds from one category increase, funds in the other decrease. Due to the recent spike in property values and an overall increase in taxable property value year over year, a tax rate reduction is expected, Benzaia said.

“[Taxpayers are seeing] large increases in their values, and they're paying more taxes, but that doesn't necessarily mean that the district receives more funding,” Benzaia said.

The preapproved budget for FY 2022-23 is about $366.49 million. About $327 million is projected to be spent on payroll cost for staff, which is 89.23% of the budget. A 2% increase in salary is included, which would cost the district about $6.8 million.

Staffing reductions will bring the district an estimated $4.8 million. Each spring, an analysis of all CCISD campuses is conducted to determine if the district’s staffing ratio guidelines are met compared to student enrollment. The reduction of enrollment in the 2021-22 school year due to the COVID-19 pandemic resulted in smaller class sizes, resulting in reductions, according to Benzaia’s presentation.

The administrative cost ratio in the budget is expected to remain at 4.31%, compared to the state standard of 8.55%.

A public hearing will be held to discuss the budget and tax rate in mid- to late July, which is when the budget is expected to be approved by the board. The tax rate is expected to be adopted by mid-September.