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Homeowners in Hays CISD may see a decrease in their tax bill, according to documents presented at a June 29 meeting.
The HCISD board of trustees approved the fiscal year 2026-27 budget at the meeting.
The overview
The general fund budget includes $275.42 million in expenditures and $287.68 million in revenues, resulting in a surplus budget.
The largest expenditure by function is instruction, at $159.59 million. This is a $5.33 million decrease from last year.
"Payroll is the largest part of our expenditures at 85%," Chief Financial Officer Deborah Ottmers said.
The general operating budget also includes:
The largest revenue source for HCISD is state funding, coming in at $146.97 million.
The estimated increase in the fund balance is $12.25 million, resulting from cuts to district spending. The district anticipates matching this number each year until 2031.
The projections
The proposed tax rate for FY 2026-27 is $1.1546 per $100 of valuation, which is unchanged from the previous rate. This includes a maintenance and operations rate of $0.6669 and an interest and sinking rate of $0.4877.
M&O tax revenue funds daily operations, such as teacher salaries, and are subject to recapture. I&S taxes are used to pay for bond debt and are not subject to recapture. HCISD has not adjusted the I&S rate since FY 2021-22, according to district documents.
Although the district is not proposing to change the tax rate, homeowners may pay less in school district taxes due to decreased home values. A homeowner of a property with a median taxable value of $182,110 could expect to pay roughly $2,103 in taxes. This is about an $80 decrease from FY 2025-26, when the median taxable homestead value was $189,550.
The background
HCISD asked voters to approve a higher tax rate last November to support district operations following several years of dwindling fund balance. Voters rejected the increase, and the district announced over $12 million in budget cuts in March. The cuts include the loss of 125 positions and the suspension of 970 stipends, directly affecting more than 1,000 employees.
Since 2021, HCISD has been pulling from the fund balance, which serves as the district’s savings account, to maintain operations while waiting for increased state funding, Community Impact previously reported. The fund balance has depleted to an estimated $20 million.
The district will add the $12.25 million to the fund balance each year for the next five years. A district’s fund balance should be able to cover up to three months of operational costs, according to HCISD officials. For HCISD, this number is approximately $65 million, according to Community Impact reporting. By 2031, the district anticipates rebuilding the fund balance to $90.14 million, according to a previous district presentation.
Looking ahead
The HCISD board will approve the tax rate in August after receiving the maximum compressed rate from the Texas Education Agency.
