As a result, district residents may continue paying $1.1469 per $100 of assessed property value for the third consecutive year, following a unanimous vote by trustees to move forward with the rate at the Aug. 12 board meeting. While the rate remains the same, exemptions may still lower tax bills, Chief Financial Officer Jill Ludwig said.
Diving in deeper
Even with projections of an upcoming $1.99 billion bond in November, officials said in an Aug. 13 news release that the consistent tax rate is due to the district’s “strong financial standing and ongoing growth in property values associated with new development.”
Ludwig said the maintenance and operations rate that contributes to district operations and staff salary, or M&O, is composed of two parts, including:
- The Maximum Compression Rate, or MCR, which is compressed by the Texas Comptroller's Office if there is property value growth
- A fixed $0.05 rate that was previously adopted by the district
“We have very little control over the actual rate because of a formula that the Texas Comptroller uses, mandated by the legislature,” trustee Jon Welch said.
While officials said the ballot for the upcoming November bond election will state “this is a property tax increase” due to state mandates, the interest and sinking rate, or I&S, which helps the district pay off its debt, will remain at $0.48—the same as the 2024-25 rate—while overall taxes have decreased by $0.12 over the past four years, Ludwig said.
Why it matters
The Texas Education Agency mandates the tax rate account for future and proposed exemptions, including the upcoming SB 4 vote in November, where voters will decide whether to increase the current $100,000 homestead exemption to $140,000, Ludwig said. The change could further reduce taxable property values and prevent the need for additional tax rate compression.
“During the legislative session, there were adjustments made to exemptions that were increased enough to eliminate almost all of the value growth that the district experienced,” she said.
What it means
Ludwig said that due to the increased homestead exemption, many homeowners will still see lower tax bills if the measure is passed in November. She said a home valued at $411,074 could see savings of around $248 compared to the 2024-25 school year.
The board discussed the tax "freeze" for homeowners 65 and older or disabled, which locks in their school tax amount unless major improvements are made, Ludwig said. Voters may also approve increasing the homestead exemption to $200,000 for seniors and disabled individuals in November.
Next steps
Trustees will vote on the proposed tax rate Aug. 26 after a public hearing period, Ludwig said.
