Add Azle to the list of Metroplex-area school districts calling for a property tax rate increase that requires local voters’ approval.
Azle Independent School District trustees voted July 16 for a “tax swap” that will raise the district’s property tax rate for maintenance and operations (M&O) by 13 cents to $1.17 per $100 of assessed taxable property value – the maximum allowed by state law.
At the same time, the portion of the tax rate used to pay off debt and interest (the interest and sinking or I&S rate) will be lowered by 13 cents, to $0.16. A “penny swap” from I&S to M&O would keep the district’s overall property tax rate for 2018 unchanged at $1.33.
Any proposed M&O tax rate above $1.04 triggers a Tax Ratification Election (TRE), requiring local voters to approve the rate hike.
The rate increase would net the district an additional $2.5 million in operating revenue, the district’s director of finance Monica Miller told school board members at a June 19 budget workshop. Miller said setting the district’s M&O rate at $1.17 would “maximize our state funding.”
“If we add these 13 pennies, this would add 31 state dollars for every 100 Azle ISD dollars,” she said. “So, we’d get a 31 percent return on our investment. We would net $2.5 million a year.”
The additional money would fund increased spending on operating expenses such as teacher and staff salaries (the largest portion of districts’ operating budgets), utilities, maintaining and upgrading facilities, and supplies.
Subtracting 13 cents from the current I&S rate also frees the district to raise that rate as much as 34 cents, to the maximum allowed $0.50, to service its debt. AISD taxpayers currently owe $149 million in outstanding debt principal and interest, according to the Texas Bond Review Board.
Azle is one of several Metroplex-area school districts asking voters for M&O tax rate increases for 2018; all are asking for the maximum rate of $1.17.
Rather than selecting the uniform election date in November, when voter participation is higher and costs are minimized, Azle trustees set their tax ratification election for Saturday, September 8.
Current Rate: $1.33
Proposed Rate: $1.33
M&O Rate Increase: 13 cents (from $1.04 to $1.17)
Additional Annual Revenue: $2.5 million
TRE Date: September 8
District Website: www.azleisd.net