Tyler

By MEGAN MIDDLETON
Staff Writer

Tyler ISD trustees voted 5-2 Tuesday to propose a tax rate at half a penny lower than its current rate and set Aug. 26 as the date to adopt the budget and tax rate.

A public hearing is expected to take place prior to the adoption of the budget and tax rate on Aug. 26, officials said.

The current total tax rate for TISD is $1.215 per $100 valuation. That includes a maintenance and operations (M&O) tax rate of $1.0297 and a debt service tax rate of .1853 per $100 valuation.

The proposed total tax rate is $1.21 per $100 valuation, which includes an M&O tax rate of $1.0247 per $100 valuation and a debt service tax rate of .1853 per $100 valuation. If adopted later this month, that would be a .4 percent, or a half-cent decrease.

The district had recommended at its last meeting keeping the M&O tax rate at the current rate of $1.0297.

But TISD Superintendent Dr. Randy Reid said after Tuesday's meeting that, "I think we can handle that (rate decrease) with minimal adjustments to our budget."

"We're still looking at exactly how we're going to make some adjustments," he added. "It may just limit the total amount we can put back into some of the other areas of great need that we had."

Board Members Brad Spradlin and Therelee Washington opposed the decision to lower the rate.

"I felt like the district's financial needs are significant, and as we move forward to provide a better education, it costs a lot of money to do that," Spradlin said after the meeting. "It's always good when a taxing entity can reduce taxes, but the needs are still there for the district."

Spradlin said he has been on the board for the last five years and seen the struggle each year to figure out what to pay for and what to set aside.

Washington, who has been on the board the longest, said after the meeting that he echoed what Spradlin said and added, "If you do the math to this, this half-cent reduction is not going to benefit all the taxpayers in town."

He said he also suspects the district will have to ask for an increase in the tax rate this time next year, probably higher than a half a cent.

"I don't want the taxpayer to feel like we are trying to swoon them with a half-cent reduction and then hit them hard next year for a higher rate," Washington said. "I've been on this board a long time. � I've seen the good times and I've seen the bad times. We are reaping the good times now. I hate to see anything that's going to stand in the way of the progress that we're trying to make."

But Board President Ron Vickery, who voted in favor of the decrease, said after the meeting that the district is in "excellent financial position, thanks in no small part to the hard work of Tosha Bjork (director of financial services for TISD)."

He said the main reason he felt the district could justify a small tax rate decrease was because of the increased targeted revenue per student the district is receiving that it was not anticipating.

"This is just a way we could provide a small tax decrease to give a little bit of a refund back to our tax-paying community," Vickery said, noting he is thankful the district is in a position to do that.

Trustee the Rev. Orenthia Mason said during the meeting that she voted in favor of the decrease because she was "assured that the district would have sufficient money to take care of its operations. I certainly hope that the promise is kept."

Earlier this year, Ms. Bjork told the board the district would likely need to raise its M&O rate by a penny.

But at the last board meeting, Ms. Bjork told trustees the rate could remain the same because the district will receive an unexpected increase in its targeted revenue per student.

The state's adjustment in a calculation resulted in TISD receiving $127 more per student in targeted revenue than in past years. The increase is expected to account for possibly about $2.8 million.

Because of the recalculation, the district received a payment from the state of about $2.8 million for the 2006-07 school year and expects to receive around that amount for the 2007-08 school year. The expected $2.8 million for the 2008-09 school year is being used to balance the proposed 2008-09 budget, Ms. Bjork has said.

Trustee Gene Shull suggested at last week's meeting that the board should consider lowering the rate because of that increase in revenue.

Shull was the board member who motioned to lower the rate at Tuesday's meeting.

He said after Tuesday's meeting that, "With the economic climate we're in today I just think that it's hard for us to take this extra money we have now gotten and not return something to the taxpayers as a dividend to them. "The only way you can do it is through the tax rate."

"We're trying to build and continue to build on the goodwill that we've already built with the taxpayers that we're always going to be good stewards of their money," he said.

He said, though, that he does expect the tax rate will likely increase next year.

Vickery said the district does still have needs and that the remaining extra revenue of around $5 million will be spent to shore up some programs. He said Reid is formulating a plan the board will consider for approval on how to best use those funds.

Ms. Bjork said after the meeting Tuesday that the proposed half-cent tax rate decrease will account for about a $4.25 annual savings for a taxpayer with a $100,000 home.

About $376,000 must be cut from the budget because of the board's decision to propose a lower tax rate, Ms. Bjork said.

The proposed 2008-09 budget now is $129,987,549, while the current year budget is $125,318,051 -- an increase of about $4.7 million.

TISD officials said previously-discussed increases in the budget, such as those for teacher and employee raises, will not be affected by the proposed tax rate decrease.

TISD is proposing to give teachers a $1,200 pay increase, raise starting teacher pay from $38,000 to $39,500 and give 3 percent of the midpoint pay increase to other employees.

Prior increases in the budget also discussed include an extra $578,000 in the transportation budget for fuel and $500,000 extra for utilities. The district is also proposing to put $350,000 toward the AVID (Advancement Via Individual Determination) program.

Ms. Bjork said Tuesday that the tax rate decrease may reduce the $500,000 planned to be set aside for technology purchases in the new budget.

The total taxable values for TISD for 2008-09 were about $7.4 billion, about a $500 million, or 7.2 percent, increase from the 2007-08 taxable values of about $6.9 billion, according to figures from the Smith County Appraisal District.

Property tax revenues for TISD in 2008-09 are projected to be $84,019,797, up about $4.2 million from 2007-08 property tax revenues of $79,831,670. That's a 5.2 percent increase. Those figures are based on a 96.75 percent collection rate.

The average home value for TISD for 2008-09 is $131,048. That's a $5,411, or about a 4.3 percent, increase from the average home value in TISD for 2007-08 of $125,637.

The average tax bill, factoring in a $15,000 homestead exemption, would be $1,404.18 for 2008-09. That's about a 4.5 percent, or $59.94, increase from the 2007-08 average tax bill of $1,344.24.