Return to Veterans' Hill

The prospect of being forced to reopen Veterans' Hill comes at an inopportune moment for a school district just now starting to recover from the effects of stagnant property tax revenue and decreased state funding. On Sept. 1, Hutto voters approved a tax ratification election, or TRE, to provide additional funding to the district through increased property taxes. The district hoped to use the revenue to restore elementary school staff layoffs and build up the general fund. Now it appears HISD will have the added burden of figuring out how to service hundreds of new students and the staff to support them.

"It means we need to continue to be really frugal with what we are doing and not add back a whole bunch of stuff," HISD Superintendent Doug Killian said. "Ultimately [Veterans' Hill] will not be enough to hold all of that development. So we're going to have to look at another area to purchase land so we can have another elementary school.

"We'll end up filling the middle schools up and then have to probably rezone to cover all of the new traffic in those middle schools."

Killian said additional taxes or selling new bonds to increase revenue is no longer an option.

"We're topped out, we can't ask for more [taxes]—we are at the legal limit," Killian said. "We don't have the capacity to pay back any new bonds."

A losing bargain

Rapidly built, starter-priced housing developments like Siena have become a losing bargain for school districts and cities, according to public officials. Neither entity believes it is likely to recoup the costs associated with the students, infrastructure and services needed to accommodate large and sudden surges in populations.

"Once you start with a huge development of subdivisions, you're always behind the eight ball," Killian said.

The Siena development lies in unincorporated Williamson County but within Round Rock's extraterritorial jurisdiction, or ETJ—meaning the city holds the right to annex the property but is not obligated to do so.

"Quite honestly, studies have shown residential subdivisions don't really pay for themselves [through taxes]," said Peter Wysocki, City of Round Rock Planning and Services director. "I don't know if there would be any advantage to the city to [annex Siena]. The advantage to the residents is we can provide fire protection, police protection and all of the development restrictions that come with being a part of the city."

HISD, however, does not have the luxury of choosing whether to serve the future residents of the Siena development.

"Since we were cut in our state funding the issue is how do you pay for all of the additional support staff that is required," Killian said. "Not just custodians—a principal, counselors, [physical education] teacher, art teachers—those have become more difficult for us to support than before. We already own the mortgage on the school; the real costs are the salaries."

HISD estimates it will cost approximately $1 million annually in operating expenses to reopen Veterans' Hill. The best way to offset the costs is with the addition of commercial developments, Killian said.

"A real balanced district is when you have commercial development as well," Killian said. "Because [commercial developments] come with tax revenue but not kids—which are costs."

Lloyd, who also developed the Hutto Square subdivision, said, however, that residential development is the predecessor to commercial.

"I put several thousand lots on the ground in Hutto proper and all of the sudden they've got Home Depot and Lowe's and all that commercial activity out there," Lloyd said. "The reason people build commercial buildings is because there's a whole bunch of rooftops there.

"It's like the chicken and the egg. You have to go out and build a bunch of houses before anyone builds a grocery store. Somebody has to go first."

'The holy trinity'

If Siena is any indicator of future housing trends, HISD may soon be dealing with a continual surge of students. Siena may just be the tip of the iceberg in Hutto, Lloyd said.

"Hutto is a hot town. The market is good all of a sudden," Lloyd said. "We went from four or five years of doing absolutely nothing to all of a sudden everyone is rushing out to do what we should have been doing over the last four or five years, which is putting lots on the ground.

"Engineers are out there seven days a week doing construction plans. So as fast as we can get the plans done and approved, we'll keep putting lots out there."

Lloyd said the attraction of Hutto to developers is the city's proximity to Toll 130 and the city's existing infrastructure.

"From Parmer Lane to Round Rock is where most of the jobs are, so that's where the bulk of the houses are going to be," Lloyd said. "You have to build somewhere people can drive and you have water and sewer. Where would you go? It pretty much has to be Round Rock, Pflugerville and Hutto—that's it. Right now it's the holy trinity."

HISD officials, however, hope developers take into account the strains additional students put on the district, including planning for the locations of new schools.

"In a lot of cases we're just there to pick up the pieces after everything has been started," Killian said. "When developers don't leave us a spot (for a school), we are left finding spots way out in the district. That's unfortunate because a good elementary school adds a lot to a development."

Lloyd, however, said because Siena was formed as part of a new taxing municipal utility district, or MUD, a school would be a money-losing deal for the development.

"It is difficult for us to have schools in the development after the fact because we are a municipal utility district, and schools are tax-exempt," Lloyd said. "It's hard to make our numbers work. We've already got an injury report that shows houses within the MUD, so it is hard to go back and change that after the fact."

Regardless of builder cooperation, Killian recognizes the looming housing developments in and around Hutto will cause a massive shift in the funding structure and size of the district.

"In the city of Hutto, there are about 17,000 people," Killian said. "You're talking about as many people in that development as there are in the entire city."