No Impact to Tax Rate
The 2017 bond will have no impact to the school District tax rate, which is $1.54 per $100 of property valuation.
As the District’s taxable values grow, the District’s capacity to sell more bonds also increases. Based on conservative growth assumptions, District officials and financial advisors estimate that EMS ISD can issue the total recommended amount of $524.7 million over the next eight years while maintaining the existing tax rate. The overall tax rate has been $1.54 since 2012-2013, and it will remain at $1.54.
Tax Rate Information
Public school taxes involve two figures, which divide the school district budget into two “buckets.” The first bucket is the Maintenance and Operations budget (M&O), which funds daily costs and recurring or consumable expenditures such as teacher and staff salaries, supplies, utilities, etc. Approximately 85 percent of the district’s M&O budget goes to teacher and staff salaries. The second bucket is the Interest and Sinking budget (I&S), also known as Debt Service, and that is used to repay debt for longer-term capital improvements approved by voters through bond elections.
Proceeds from a bond issue can be used for the construction and renovation of facilities, the acquisition of land and the purchase of capital items such as equipment, technology and transportation. By law, I&S funds cannot be used to pay M&O expenses, which means that voter-approved bonds cannot be used to increase teacher salaries or pay rising costs for utilities and services.
Eagle Mountain-Saginaw ISD’s I&S tax rate is $0.37 and the M&O tax rate is $1.17, for a total tax rate of $1.54 per $100 of certified property value.
Senior Citizens’ Property Taxes
According to state law, the dollar amount of school taxes imposed on the residence homestead of a person 65 years of age or older cannot be increased above the amount paid in the first year after the person turned 65 – regardless of changes in tax rate or property value – unless significant improvements are made to the home.
The November 7, 2017, bond election in Eagle Mountain-Saginaw ISD will have no impact on the school District tax rate. The overall tax rate will be $1.54 regardless of the election outcome.
Bond Election vs. Tax Ratification Election
- Revenue from Bond Elections add funds to the District’s Interest & Sinking (I&S) budget, which is used to repay debt for capital improvements.
- By law, I&S funds cannot be used to pay M&O expenses, which means that voter-approved bonds cannot be used to increase teacher salaries or pay rising costs for utilities and services.
- Revenue from the Tax Ratification Election (TRE), which Eagle Mountain-Saginaw ISD voters approved in September 2013, added approximately $650,000 annually to the Maintenance & Operations (M&O) budget.
- M&O funds are used for daily costs like teacher and staff salaries, supplies, food and utilities.