Klein ISD passed a 2015-16 budget in August that includes more than 100 new staff positions, a 4 percent raise for employees and a smaller than expected 2-cent tax rate increase. 

Approved  by the board of trustees Aug. 31, the budget proposes a property tax rate of $1.41 per $100 of valuation, which will be voted on by the board in October.

“I think this is a great budget,” KISD Superintendent Jim Cain said. “I tip my cap to the folks [in the finance department] because every year we go through a very stringent analysis of where we are and where we need to be.”

State surprise

District officials said predicting funding from the state can be a challenge, which is why KISD provides conservative estimates in its initial budget proposals. However, despite a $6.6 million decrease in net state aid last year, the Legislature provided $8.4 million more than the district initially expected.

Thomas Petrek, associate superintendent of financial services, said the state’s funding increased because the Legislature increased the basic allotment for education funding during the session this summer and increased the guaranteed yield for property-poor districts.

“You always are trying to speculate whenever the Legislature is in session what your revenue stream is going to be,” Cain said.

The additional revenue allowed the district to fund several changes to the budget, including a $3.57 million transfer to the debt service fund. Following the passage of the $498.1 million bond referendum in May, the district had predicted the debt service rate—or the portion of tax revenue used to pay down accumulated debt—would increase by 4 cents in 2015-16.

The transfer allowed KISD to lower the proposed rate increase to 2 cents in 2015-16, district officials said.

If approved by the board, the average homeowner would pay about $222 more in taxes than last year. Petrek said it is too early to tell whether the tax rate will continue to be lower than the 10 cent increase projected over the next several years to pay off debt from the bond.

“The actual taxable value growth for the past two years has outpaced my projections,” Petrek said. “This will cause the debt rate to increase slower over time and perhaps not even make it to the projected 10 cent [increase].”

State funding also allowed the district to provide a 4 percent raise to the control point—or a point between the minimum salary and maximum salary—of all KISD staff, Cain said. The district also used the money to increase the employer contribution to employees enrolled in the TRS Active Care health plan at a cost of $2.2 million.

“We want to be able to attract good teachers to our system and be competitive with the market, and we want to appropriately compensate our teachers who are already here,” Cain said. “It goes beyond the teachers. We’re talking about all of the 6,500 employees.”

Board President Steven Smith and Vice President Rick Mann emphasized the need to approve the salary raise and employer contribution.

“That’s how you keep good teachers, good staff [and] continue to say, ‘Thank you’ to your employees because teachers are not overpaid,” Mann said.

Property tax boost

KISD projects property tax collections will increase $32 million in 2015-16 from the 2014-15 amended budget. Petrek attributed growth to a combination of new development on the north side of the district and an increase in property values.

“This kind of growth in real taxable value per year is unprecedented,” Petrek said. “We have seen double-digit percentage growth in the past, but the tax roll was a lot smaller [then] yielding a smaller [revenue increase] than what we have added over the past two years.”

The vast majority of the additional revenue went to payroll costs this year to accommodate districtwide growth as payroll costs rose almost $16.7 million from the 2014-15 amended budget.

The district added about 143 full-time equivalent personnel for 2015-16 to accommodate growth at the district. Although about 41 positions were added to French Elementary School—which opened in August—the majority of those positions were filled by existing KISD employees at other schools.

“We only have two new teachers [at French Elementary] from outside the district,” French Elementary Principal Carol Mason said. “It is helpful to have staff from within the district because they are familiar with our procedures and know how to access information.”

Despite the costs needed to fund a growing school district, KISD officials and board members said they welcome the growth and the challenges that come with it.

“We think it’s great when companies relocate employees here, when new homes are being built [and] when more and more students are coming into our system,” Cain said.

Mann and Smith said they were pleased with the budget, which they both believe is conservative.

“I feel very good [about this budget],” Smith said. “Of course we review things [and] we cut some things, but we’ve always been pleased with the quality of the numbers [the district has] submitted. This budget’s no exception.”