The board approved 6-0 publishing notices for a July 15 public hearing, at which it may set a proposed tax rate. Setting that would result in calling a “tax ratification election” to be held on or after Sept. 14.
Under consideration is an election on increasing the part of the tax rate used for maintenance and operation (M&O), and lowering the portion used for “interest and sinking,” (I&S), which are funds used to pay debt.
GISD says the change, which requires voter approval, would not increase the overall tax rate, but Supt. Rick Albritton said it would bring the school $200,000 more next fiscal year in state funding, since state aid is somewhat based on the M&O rate.
The school’s current tax rate is $1.185 per $100 valuation. The election would be on raising the part used for M&O from the currrent $1.04 to the state-allowed maxiumum $1.17, which would result in the board lowering the portion used for I&S from the current 14.5 cents to 1.5 cents, Albritton said.
Raising the M&O part of the rate above $1.04 requires voter approval under state law.
Board member Diedra Camp said the overall tax rate wouldn’t change whether the district receives the extra $200,000 in state aid or not—a reference to school officials’ plan that the overall rate would remain the same, regardless of the election’s outcome.
Albritton said “the real confusing part” of the process will be the way the advertising of the tax rate must be done. Under a quirk in state law, the board must advertise that approving the proposal would raise the overall tax rate from the current $1.185 to $1.315.
That is because the election is on raising the M&O part of the rate by 13 cents. But that advertisement will not reflect that the board would also lower the I&S part of the tax rate by that same amount if voters approve the M&O raise, leaving the overall rate at the current $1.185.
Albritton said the school will thus run a second advertisement beside the first one, explaining that passage of the tax proposal would result in the board reducing the I&S rate from 14.5 cents/$100 to 1.5.
By law, “We cannot be political. We cannot go out and say ‘vote for it,’” he added. However, the school has employed a consultant who has obtained passage of similar proposals in other Texas schools, he noted.
Not counting the potential $200,000 increase in state funding by revising the tax rate, Gilmer ISD might receive a net increase of $300,000 in state aid each year for the coming two fiscal years under the newly-approved state budget, Albritton said.
That would recoup part of the $2 million reduction in state funding over the last two years, thus allowing giving raises at some point, Albritton told trustees.
The legislation would have given the district $800,000 per year, but GISD won’t receive $500,000 of that yearly because “we did a very good job of getting additional money (locally)” through such means as collecting “every delinquent tax we could get,” Albritton said.
In addition, since the school’s overall tax rate was once $1.45 per $100 valuation instead of the $1.50 maximum then allowed by state law, the state also pro-rated Gilmer’s aid, he pointed out.
Even so, Albritton said, the school’s only tax increase in his 10 years as superintendent was one which voters approved in a bond election.
He predicted state funding will eventually increase again “where we can start giving raises,” but added that GISD will reinstate “very few” of the jobs eliminated when the state slashed funding two years ago.