The Orangefield school board is asking voters in the school district to approve a tax increase to make up for lost income from state financing. The district has set a special Tax Ratification Election (TRE) for Saturday, October 3, with early voting to start September 16. “The state is not making a commitment to fund public schools,” Superintendent Dr. Stephen Patterson said.
The board is proposing to keep the local 20 percent homestead exemption and increase the tax rate from $1.04 per $100 valuation to $1.17 per $100 valuation for the maintenance and operations part of the budget. That does not include taxes from previous bond elections. Orangefield has 13 cents per $100 valuation for the bonded indebtedness, the lowest in Orange County.
Patterson said the median price of a house with homestead exemption is $117,000. The proposed tax increase up before the voters will cost the owner of a $117,000 house $8.52 a month more. Homeowners age 65 and older, plus those with disability exemptions have their school property taxes frozen and will not pay any more.
Details of taxes, state funding, property values and other information for Orangefield are in a 24-page Power Point presentation the district has made. The Power Point is on the homepage of the district’s website and will be used at seven community meetings. The first will be at 6:30 p.m. Thursday at the Orangefield Elementary cafeteria. Another will be Tuesday, August 25 at the same time and place, plus all five Tuesdays in September.
The Tax Ratification Election, if it passes, will also increase the amount of state money to be sent to the district. Patterson said the tax increase will raise an estimated $548,500 in local money. The state will kick in an extra $398,500 because the district will meet some of the funding guidelines.
That alone can be confusing. But for anyone dealing with Texas financing of public schools, the conundrum is typical. Most school districts join organizations with lawyers and accountants on staff to help interpret legislation involving financing.
For more than a decade the Texas Legislature has wanted to cut taxes and have forced school districts into cuts. Ten years ago, the state had a cap of $1.50 per $100 valuation on the basic tax rate for maintenance and operations. Orangefield had a $1.48 per $100 valuation with a 13 cents for bonds giving a total of $1.61 per $100 valuation.
The legislature forced all school districts to have a maximum rate for basic maintenance and operations at $1.04, drastically dropping tax revenues for 2006. Patterson said inflation made costs increase for school districts but their incomes went down. “We’re asking for 13 cents of that 44 cents back,” he said about the Tax Ratification Election.
The economy had a setback in 2009 and the state legislature used federal stimulus to give $5.4 billion to help pay for education. In 2011, the federal money was gone and the state cut education. The West Orange-Cove school district in 2012 approved a Tax Ratification Election with citizens there voting to go up to $1.17 per $100 valuation to help balance the budget.
“Since that federal funding, we’ve had six years of inflation, six years of added state mandates and six years of federal mandates,” Patterson said. Local taxpayers have had to make up the difference.
The latest state move comes with a constitutional amendment that voters will have on ballots in November. The state currently mandates all public school districts give homeowners with a homestead exemption a $15,000 exemption. Under that rule, the owner of a house valued at $100,000 automatically pays on a value of $85,000. The constitutional amendment will increase the exemption to $25,000. Patterson said he expects the constitutional amendment to pass. Orangefield ISD will lose $224,000 from the extra state exemption because the district does not have a large industrial base. Patterson said the district has “rooftops,” not industries.
In addition to the state mandated homestead exemption, individual school boards can give additional home. The Orangefield and West Orange-Cove school districts give the maximum 20 percent exemption. That takes another 20 percent off the taxable value. Little Cypress-Mauriceville and Vidor have 15 percent exemptions. Bridge City had a 10 percent exemption but voted this year to remove the local exemptions. The proposed state constitution will also have districts keep the same amount of homestead exemption for another five years.
Patterson said the Orangefield school board decided to keep the homestead exemption and instead ask for voters to approve the Tax Ratification Election.
The Power Point presentation online also email addresses for all school board members and for Patterson. He encourages anyone with questions to contact him or the board members. -Margaret Toal, KOGT-
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