- Why can't we pay for these repairs out of the normal operating
budget?
- While state funds have decreased 30%% in the past 4 years,
we have had to rely on local taxpayers to fund the majority of
our school district's operating budget. Although we have received
more dollars from local taxes, the total increase in revenue
after the state's reduction amounted to less than one half of
one percent this past budget year. Yet, the district still had
a higher enrollment than the previous year. After several years
of similar scenarios, the budget for capital improvement projects
has been cut in order to use that money to hire staff for the
increased student enrollment and to fund modest cost of living
increases for our employees, increases in gasoline, electricity,
health insurance, etc.
With the district's $ 1.50 tax rate at the cap, it is not
possible to raise additional maintenance and operation revenue
except through local revenue growth.
How far into the future will this bond package support
the districts needs?
The average life expectancy of these projects is twenty years.
The debt incurred by this bond could be paid off at the same
time as our existing debt, but no longer than twenty years.
How do schools pay for a bond?
Most school districts levy two different taxes. One is for
maintenance and operation (M&O) and covers day to day operations
of the district. The current M&O tax rate in FISD is $1.50.
That is the maximum allowed under current law. The second tax
levied is a debt service tax that is currently 13.7 cents. It
is with the debt service tax that schools repay their loans used
to build school facilities.
How much will a property owner's taxes increase if this
bond passes?
The current tax rate will not change and this proposed bond
package can be paid off at the same time as our current bonds.
Will the bond issue increase taxes for citizens 65 years
old and older?
Citizens who are 65 and older or disabled have a tax ceiling,
which means that their current taxes will not increase.
How can this bond be done without a tax increase?
Under our current bond payment structure, the 13.7 cent tax
rate does not cover the entire annual payment. The Texas Legislature
has appropriated money to districts in order to help offset construction
of new facilities. Although that money is never guaranteed, each
year FISD has received enough funds from the state to offset
the difference our tax rate did not raise resulting in a positive
fund balance in the debt service fund. With this money and with
projected increases in growth, the district has the capacity
to fund much more than an 8.5 million dollar bond without an
increase in the tax rate.
What does Proposition 2 cover?
Proposition 2 is to move debt incurred under a maintenance
tax note from the Maintenance and Operation budget to the debt
service side.
How is it legal to move that debt from the M & O budget
to the debt service side of the budget?
Chapter 1207 of the Texas Government Code authorizes the
District to issue refunding bonds to refund any outstanding obligations
of the District and provides that such refunding bonds may be
made payable from taxes. Because the Texas Constitution requires
an election before school district may issue bond payable from
an unlimited tax, the District is submitting Proposition Two
to the voters. If approved, the proposition will authorize refunding
bonds payable from the debt service tax in compliance with the
Texas Constitution and Chapter 1207 of the Government Code.
What is the advantage to moving M&O to the debt service
side of the budget?
It will free up money in the district's M & O budget
that would otherwise be used to pay this loan. FISD carries
relatively little debt, especially for a growing district. In
13 years, all of its current debt will be paid off. By restructuring
our debt, this loan can be paid for with no tax increase and
in the same time period as our other debt.
Why doesn't the school board go ahead and move the debt
over to the debt service side?
Only the voters can approve that transaction.
Where can I go if I have more questions?
The District's website, www.fisdk12.net
any school trustee, or the Superintendent's office can provide
more information.
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