The San Marcos CISD board of trustees will hold a public hearing at 6 p.m. on Aug. 4 at the district's central office to discuss the proposed 2014–15 tax rate of $1.4141 per $100 of property valuation. The current tax rate is $1.4141 per $100 of property valuation, but the new recommendation, which was voted on and unanimously approved at the board's July 21 meeting, would allocate the money differently. The school district's property tax rate is composed of two parts: interest and sinking, or I&S, which is dedicated to paying down the district's debt; and maintenance and operations, or M&O, which covers the basic functions of the school district including payroll and equipment. The current amount dedicated to I&S is 0.3741 per $100 of home valuation. Because the district is no longer required to service the existing bond debt, the district is proposing an I&S rate of $0.3541. The other 2 cents would be transferred to the district's M&O fund, which would total $1.06 per $100 of home valuation. In San Marcos, 2 cents per $100 of property valuation amounts to about $700,000 of property tax annually. Superintendent Mark Eads said because the M&O rate is being increased to $1.06, the district would become eligible to receive an extra $500,000 from the state. "Those $700,000 that are being generated on the I&S side would actually generate about $1.2 million on the M&O side," Eads said. The reallocation of funds would require a tax ratification election, or TRE, voted on by San Marcos CISD taxpayers. In order to meet timing requirements, the district will have to hold a public hearing Aug. 4 to discuss and adopt the proposed tax rate. After the district adopts the rate, the TRE would be set for early September. "Our timeline is very sensitive on this," Eads said. Eads said the additional revenue generated by the reallocation could be used to cover pay raises for teachers or "any area that we need that would go to M&O." The district will also hold a public hearing to discuss the 2014–15 budget Aug. 18 at 6 p.m. at the San Marcos CISD board room.