The Levelland ISD Board of Trustees held a special meeting last week where the group adopted a budget and a tax rate for the Fiscal Year 2025.
State law requires a public hearing prior to the adoption of a budget. Any taxpayer in the district was allowed to attend and participate in the hearing. The Board is required to adopt the budget at this meeting as a separate item on the agenda.
Additionally, the Board is required to discuss the proposed tax rate and to hear public comment. The proposed tax rate for the 2024 tax year is $0.7142 per $100 value for the purposes of maintenance and operation, and $0.2600 per $100 value for debt service for am total of $0.9742 per $100 value, which is the same rate as 2023-2024.
The budget and tax rate were each separately approved following each public hear with unanimous agreement.
“We have been trying to get the deficit down as we knew we were going to have a deficit similar to roughly 80% of the districts within the state,” said Levelland ISD Superintendent Becky McCutchen. “Officially, we were able to get the deficit amount of $3.8 million down to the $3.1 million which was discussed in the prior budget work session.”
McCutchen explained that many school districts are dealing with a deficit budget due to the rising costs and inflation.
“Districts are still receiving funding based off of 2019 funding ratios which means we are still receiving the same basic allotment,” explained McCutchen. “We are working to be very conservative with spending and ensuring students are being served appropriately while being mindful of the districts dollars.”
McCutchen also added that legislation was informing districts that they would address the funding ratios when the federal funding each district received was exhausted, but they have yet to do so.
Currently, the deficit amount does include the loss of funding of roughly $800,000 if the Hockley County Appraisal District does fail the districts property value study similar to this past study. If the property value study is not inline with the Texas comptroller’s office, that will result in the loss of those funds, which happened this past year.
“We will not know that until January, but based on preliminary information we are anticipating the study will not be inline with the comptroller,” said McCutchen. “We will not have the final answer until January.”
For this budget, the district has roughly $590,000 in capital assets. Those funds are awaiting a decision regarding the replacement of route buses. McCutchen explained that the district currently implements a transportation replacement cycle and there are a handful of route busses that need to be replaced. However, the hope is the district can extend those busses a bit more. Another aspect for those funds is the ‘white fleet’ which consists of the suburbans and white vehicles as the district has not purchased any new vehicles since early 2020. With the miles adding up on those vehicles, decisions will need to be made in the upcoming fiscal year on whether replacement is needed or not.
If the decision is to not exhaust the entire sum of the $590,000, those funds could be used to lower the deficit amount of $3.1 million.
Similar to American Relief Plan Act (ARPA) funds distributed to municipalities, counties and other entities as a result of the pandemic, school districts were provided Elementary and Secondary School Emergency Relief funds (ESSER). Texas received $1.3 billion in ESSER I funding, an additional $5.5 billion in ESSER II, and $12.4 billion in American Rescue Plan (ARP) funds (also referred to as ESSER III).
With those having a deadline to be spent by Sept. 2024, the district had been using $2.1 million in the last budget for salaries. In turn, that amount was absorbed and put it into the budget. Through attrition, McCutchen said the district did not fill vacant positions and instead absorbed those spots which returned approximately $1 million in savings.
Additional savings were made following LISD becoming a stand alone special education district. The district went from spending roughly $700,000 to saving $200,000 of those funds which will be utilized in the general fund.
Due to current budgetary needs, debt obligations, and future state aid implications, continued maximum local tax effort is necessary. This effort requires that the District adopt a tax rate of $0.7142 per $100 value for the purpose of maintenance and operation, and $0.2600 per $100 value for the payment of principle and interest on bonds, for a total of $0.9742 per $100 value.
The adopted tax rate will be staying the same as this current year which is decided by the Texas Education Agency (TEA). The agency receives districts certified values and they compress those values and inform the districts of their tax rate they can adopt.