HCISD asks voters for tax hike, warns of cuts without new revenue From the cover
The breakdown
Hays CISD tax rate history
Maintenance and operations
Interest and sinking
Tax rate per $100 valuation
$0.5 $1 $1.5 $2 0
The board of trustees approved placing the VATRE on the ballot during an Aug. 18 meeting. Wright said updated state funding that passed during the legislative session does not give schools the flexibility to cover all of their costs. Much of the $8.5 billion in funding is earmarked for teacher and staff raises or other specific uses. “We are being forced into a position where, since the state won’t take care of us, we’re going to ask potentially to get a tax ratification election on the ballot for November to see if our local taxpayers will help us out,” Wright said before the board approved the motion. Texas school districts are limited in the amount of new revenue they can generate without seeking
2017-18
2019-20
2021-22
2023-24
2025-26*
2015-16
Fiscal year
*PROPOSED
SOURCE: HAYS CISD/COMMUNITY IMPACT
voter approval. The maximum allowed tax rate HCISD could set in fiscal year 2025-26 without the election is $1.1546 per $100 valuation, with a maintenance and operations tax rate of $0.6169, according to the district.
The district is asking voters to approve a 12-cent increase to the maintenance and operations tax rate. This proposed increase would raise it from $0.6669 to $0.7869, making the total proposed tax rate $1.2746 per $100 valuation.
How we got here
Future paths
If the VATRE is approved, the district would use the funds to add roughly $20 million to its fund balance for the next three years to rebuild it, Ottmers said. If the VATRE fails, one of the biggest impacts would be on HCISD employees. Wright said over 15% of the district’s current workforce, from teachers to administrators, would be cut over the next three years.
Wright said inflation and rising staffing costs are driving HCISD’s budget shortfall, with payroll accounting for 89% of the budget, or $18 mil- lion-$20 million monthly. Salaries were increased during the pandemic to retain teachers, a strategy that worked but left ongoing costs, he said. He added that attrition in the district is approxi- mately 6%, compared to 15%-17% statewide, which limits savings through turnover. HCISD depleted its fund balance, or savings account, to make ends meet for student program- ming and staff retention, Wright said. The fund balance dwindled from around $71 million in 2021 to an estimated $20 million-$24 million at the close of the 2024-25 fiscal year. On Aug. 25, the district issued a tax anticipation
note to cover payroll until tax revenue is collected in February. The current fund balance is equivalent to roughly one month of operating costs, which is far below the Texas Education Agency’s guidelines, Ottmers said. The guidelines would require $67 million—about three times more than the district has now. “Nobody can have the same dollar for seven years and not go into their savings. If you didn’t hire extra people, and if you didn’t give raises, your fund balance would still be going down,” Ottmers said. “You cannot live on the same dollar with the same expenditures because they all went up 20%-25%.”
If the VATRE passes, the district will
Give cost-of-living raises for teachers and staff separate from the HB 2 increases
Rebuild the current fund balance to $65 million by 2028
Hays CISD 2025-26 budget The district passed a budget in June that uses $6 million of income from a possible land sale. If the VATRE fails, the district anticipates a growing shortfall in future years.
Income
Expenditures
Pause class size increases
Federal $11.38M State $129.33M Local $230.8M
Payroll $236.14M
Debt services $95.7M
If the VATRE fails, the district will
Professional services $14.6M
Cut up to 600 employees— 200 employee cuts per year over the next three years
Food services $14.02M
Self-insurance $6M
Supplies and materials $11.12M
Cut student programming
Other $5.94M
Increase class sizes
Total: $377,502,115
Total: $377,502,115
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