EducationLocal NewsTaxes & SpendingGarland ISD Referendum Would Increase Property Taxes, Trigger More State Funding

The board of trustees has lowered part of the property tax rate. Now, they're asking voters to increase the other portion.
September 11, 2020
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Garland Independent School District (GISD) has placed a measure on the general election ballot that will increase the amount of revenue the district receives via property taxes and trigger additional funding from the state.

The GISD Board of Trustees approved the Voter-Approval Tax Rate Election (VATRE) in a special meeting on August 11.

Presiding Trustee Johnny Beach stated in a news release that $42 million would be raised from the proposition.

“If voters approve the VATRE, homeowners will see a lower property tax rate in 2020-2021 while our school district will benefit from an almost $42 million increase in funding annually,” Beach said.

“These funds would be used to provide competitive teacher salaries, expanded Pre-K offerings, additional academic and fine arts opportunities, and more.”

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School district property taxes are divided into two parts: the maintenance and operations tax rate, and the interest and sinking tax rate. GISD decreased the interest and sinking tax rate at the special August 11 meeting to offset the proposed increase in the maintenance and operations tax rate.

GISD Superintendent Dr. Ricardo Lopez has characterized the VATRE as a “tax reduction election,” but the question is not whether to lower the overall property tax rate. The proposition is to increase the maintenance and operations rate, which will result in more overall tax revenue for the district.

The passage or failure of the maintenance and operations rate increase does not affect the interest and sinking rate decrease, which has already been passed by the board of trustees.

Trustee Wes Johnson stated at the special meeting that the district could not go back and increase the interest and sinking rate even if the proposed maintenance and operations rate fails.

The overall tax rate will go down whether the proposition passes or not, but it will go down less if the VATRE passes.

GISD Chief Financial Officer Dr. Brent Ringo explained that the district has an incentive to increase its maintenance and operations tax rate to secure more funding from the state.

However, the same funding is not triggered by the interest and sinking tax rate; therefore, the district is better off increasing its maintenance and operations tax rate and lowering the interest and sinking rate to access additional state funding.

Ringo noted that 84 percent of the maintenance and operations budget is payroll.

He emphasized that the GISD Board of Trustees had to adopt a tax rate and, if they desired, call a VATRE before the certified taxable values were available because the Dallas Central Appraisal District (DCAD) is behind schedule.

If the proposed tax rate is passed, someone in Garland with a median home value, which is $209,050 according to Zillow, would pay a total of $2,814.

The median home value at this time last year was $205,961, which at last year’s tax rate would have resulted in a $2,863 bill.

Even though the net tax rate will still decrease if the proposed maintenance and operations tax rate passes, taxpayers collectively will pay more due to an increase in total appraised values. Individual taxpayers’ bills will depend on their specific property value change.

While there are still appraisals in dispute, DCAD says that the combined certified and disputed taxable value for 2020 is $23.8 billion. At GISD’s proposed overall tax rate of $1.3463 per $100 of taxable value, that would result in taxpayers footing $320 million of the bill. 

Last year, property owners paid $297 million with an overall tax rate of $1.39 for every $100 of taxable value. There was $21.4 billion in taxable property in GISD last year.

Therefore, while the overall tax rate would decrease, the proposed rate would not yield less tax revenue.

Decreasing the interest and sinking tax rate merely reduces the amount that the district is paying toward its debt service, which taxpayers will ultimately have to pay anyway.

Including principal and interest, GISD was $737 million in debt as of August 2019, according to the most recent data available from the Texas Bond Review Board.

Below is the resolution passed by the GISD Board of Trustees calling the voter-approval tax rate election.

Brad Johnson contributed to this report.

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Hayden Sparks

Hayden Sparks

Hayden Sparks is a reporter for The Texan in Dallas. During the academic year, he coaches high school competitive speech and debate and has also been involved in community theater and politics. A native Texan, Hayden served as a delegate at the Republican Party of Texas Convention in 2016. He is on track to receive a bachelor’s degree in psychology from Liberty University. In his free time, Hayden is known to take walks around the neighborhood while listening to random music on Spotify.