Thursday, September 6, 2007

Tax Roll Back Election for ROISD? Not in Your Lifetime!

Two larger school districts (San Antonio ISD and Ysleta ISD) and several smaller ones around the state will hold rollback elections this fall. That will give a district’s voters the opportunity either to accept or to roll back the tax rate the board of trustees sets for maintenance and operations.

This is a provision of House Bill 1, which the 79th Texas Legislature adopted during its 2006 special session as a key part of changes in how the state funds public schools. The rollback mechanism is intended to boost voter control over how much school boards can increase the M&O tax rate.

A district can raise its tax rate for M&O by 4 cents per $100 assessed valuation without seeking voter approval. Anything more than that requires an election. (Prior to HB 1, a school board could raise the M&O rate by up to 8 cents without voter approval.)

But HB 1 limits how much more voters can approve increasing the tax rate for this purpose, to no more than 17 cents in any given election. Prior to HB 1, the state did not impose a cap on how much voters could approve boosting an M&O rate, so long as the total did not exceed $1.50 per $100 valuation, except in districts that were able to obtain special state approval for higher rates.

The rollback provision is coupled with HB 1’s property tax reduction, from the $1.50 state law previously allowed to $1, over two years. The 79th Legislature committed the state to funding that difference, which boosts the state’s share of the total cost of public schools.

Districts that previously had state approval for rates higher than $1.50 are required to reduce that by one-third over the same two years. The end result in those districts will be lower M&O rates but ones that are somewhat higher than the $1 to $1.17 per $100 valuation that will be typical across the state.

The rollback provisions do not affect the tax rate a district sets for bonded indebtedness. “The portion of the overall rate used to retire debt may rise as high as necessary without triggering the threat of a rollback,” according to the Texas comptroller’s office.

The state will increase funding to school districts as enrollment grows – and cut funding if enrollment decreases. The state will not give additional money to districts to meet higher expenses for fuel, employee health care, etc.

Districts will have to meet these needs, to the extent they can, by raising their tax rates for M&O. Districts, however, will not benefit much from increases in property valuations. The state will siphon off much of that revenue stream.

Whether or to what extent the state will fund future pay raises and how much of that will fall to local districts is unknown now.

The state will provide some additional money in matching funds to “property-poor” districts that raise their tax rates for M&O. “Property-rich” districts will have to send part of the money they raise from M&O rate changes of more than 4 cents to help pay for funding equalization. HB 1 re-packaged but did not eliminate “Robin Hood.”

Should we start asking questions about having a roll back? Sure...questions are great and keeps the powers that be on their toes. An informed electorate is always more effective. Can ROISD afford a successful roll back election? That's another question I am leaving to y'all. Just remember that the district has terminated 43 persons so far to balance their books versus a huge bonded indebtedness formula. I believe a roll back election might be good for the district simply to get a "finger in the wind". Doubt it will's not a tax and spend program and would actually benefit property owners.

Let's see what pans out. I just bet that this never sees the light of to publish my post WDL, ECP, Red Oak Record, Ellis County Chronicle?

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