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Home News-Telegram News District could see $13 million from state if bond passes

District could see $13 million from state if bond passes

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Sulphur Springs Independent School District officials expect to receive as much as $13 million from the state of Texas if voters in the district approve a $48.4 million bond proposal on May 9.

Early voting on the bond issue, which would build a new middle school and pay for other improvements, begins Monday, and members of the Hopkins County Republican Party sponsored a forum Thursday night to let the public learn more about the subject.

Since March 9, when the SSISD board of trustees voted unanimously to call for the bond election, financial planners and other district officials have estimated the bond issue would require a tax rate of 30 cents per $100 of property value for debt service.

But the final number could actually be much lower, although Superintendent Patsy Bolton said it’s impossible to estimate exactly how much.

Bolton said she can virtually guarantee it won’t be higher.

“The 30 cents is the maximum it will be,” Bolton told a crowd of about 50 people at the GOP meeting, held at the Professional Ag Workers Building in Buford Park.

Bolton explained that, under current law, SSISD would receive millions of dollars in reimbursements from the state if the bond passes.

The district currently receives an “Existing Debt Allotment,” or EDA, which is essentially a rebate from the state of Texas to help pay for improvements. Under current statutes, 27 percent of the cost of the bond — or just over $13 million — would be reimbursed to SSISD through EDA funding.

“If that law stays in place — and we certainly hope it does, but with the Legislature meeting, you never know — we expect to receive EDA funds on this new debt,” Bolton said. “If that’s the case, it won’t go to 30 cents. It will be below that.”

Without passage of the bond, however, the district will not qualify for that money.

Even with a 30-cent tax, Bolton said, the overall tax rate for SSISD would still be lower than four years ago. She also explained why any change in the tax rate will not force taxpayers over age 65 to pay one penny more in taxes.

In Texas, school tax rates are broken down into two sections. One is for “M&O,” or maintenance and operations (the cost of operating the school system day in and day out). The other is the cryptically named “Interest and Sinking” rate, which is simply the tax amount needed to pay off debt.

Three years ago, SSISD’s total tax rate was $1.50 — the M&O was $1.42 per $100 of property value, and the I&S rate was 8 cents per $100. The next year, the Texas Legislature changed the laws governing local property taxes, and the maximum cap on the M&O tax rate was set at $1.04, and the maximum allowed I&S rate changed to 50 cents.

Consequently, the current SSISD rate is $1.04 for M&O and 9 cents for I&S, for a total of $1.13. If the bond passes, the M&O would probably stay at the maximum of $1.04 and I&S would rise to 39 cents for a total of $1.43 per $100 of taxable value — or 7 cents lower than in 2005-2006.

But for many people in the district, their tax bill wouldn’t change one cent — taxpayers 65 and over who have applied for a homestead exemption will not be affected. The total tax bill is frozen at the amount paid when the property owner applies for that exemption. 

“It is against the law for us to raise your taxes if you signed up for that exemption — your dollar amount is frozen,” Bolton said, citing Section C, Chapter 11 of the Texas Property Tax Code, which also extends the exemption to people with disabilities.

“People say, ‘But the appraised values go up — they keep raising the appraisal,’” Bolton noted. “That doesn’t make any difference for someone who it 65 and over. The dollar amount is frozen. You won’t have to pay one penny more for this bond issue.”

For one, the financial planners were extremely conservative in their estimates, calculating the 30 cents based on property values staying the same for the life of the bond.

“In figuring this at the 30 cents, the appraised value was kept level,” Bolton said. “There are not many years that your appraised value stay the same, although in these economic times, it may. But if the appraised value of property increases, then that’s going to help with the 30 cents, as well.”

Besides building a new middle school on 53.39 acres south of Interstate 30, between State Highway 19 and County Road 1103, the bond money would fund other changes in SSISD operations:

=  Move all third and fourth graders to the current middle school, and add a connecting corridor and entrance at the middle school for improved security.

=  House all first and second grade students at Travis, Lamar and Bowie schools.

= Move the alternative classrooms to the Austin Elementary campus.

= Add classrooms to Douglas Intermediate School, which would still house all fifth graders

= Build a multi-purpose facility at the high school that would serve about 700 students in extracurricular activities, including athletics, band, cheerleading, flag corps, as well as elementary field days and state-mandated physical fitness activities.

= Complete the soccer/track arena at the high school with restrooms, concession area, lights, parking and seating.

 

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