NORTH EAST

INDEPENDENT SCHOOL DISTRICT

PROPERTY TAX RATE STRATEGY Tradition of Excellence

Because property values continue to increase and NEISD has responsibly managed its debt obligations, it has the ability to
reduce the debt service (I&S) tax rate by 4. At the same time, the District can increase the maintenance and operations
(M&O) tax rate by 2 thus reducing the overall property tax rate by 2.
Your school property tax is made up of two combined tax rates:
Maintenance and Operations (M&O rate) = day-to-day operations (e.g., teacher salaries, instructional materials); and
Interest & Sinking (I&S rate) = money can only be used to pay long-term debt (i.e., bonds for construction projects)

Why should NEISD consider a NEW tax rate strategy?

2011-2012 2016-2017 Combined property taxes & state aid 100%

6% 8% 8% 8% 8% 8% 8%
have always totaled approximately 90%
15% 11% 8%
23% 19%
92% of General Fund revenue. Due to 80% 31% 28%
70%
2015s and 2017s legislative
60%
(in)actions, the local property tax share
50%
will be near 78% by 2018-2019. If the 82% 85%
35% 58% 23% 69% legislature does nothing again in 2019,
40%
62% 64% 69% 74% 78%
State Local State Local local share will increase to 85% by
30%

Other 7% Other 8% 20%

2020-2021. 10%
0%
2014-2015 2015-2016 2016-2017 2017-2018 2018-2019 2019-2020 2020-2021

State aid is shrinking Local Taxes State Other

How is NEISD able to consider a new tax rate Who could benefit?
strategy? Students
Property Values have increased Provide resources to maintain quality programs

NEISDs responsible debt management program Teachers & Staff

Commercial Paper Program Competitive Salaries & Benefits

Refunding of bonds Tax Payer 2016 2017

TAX RATE TAX RATE
Implementation of variable rate debt program 2 net property tax
rate reduction

$1.385 $1.365
How could it work?
A new tax rate strategy would save taxpayers 2 on their total taxes
by reducing the I&S tax rate by 4 and increasing the M&O tax rate
by 2 cents.
Debt Service Maintenance and Operations

Today = $1.385 Benefits:

Decreases property tax rate by 2
34.5 $1.04 Increase overall revenue by $16.1M
With
New = $1.365
Strategy
30.5 $1.06