Northside Independent School District trustees unanimously approved a $1.4 billion budget for the 2018-19 school year on Tuesday night.
The budget, which reduces general fund expenditures, decreased about $8 million from the last school year and created a general fund deficit of close to $30 million. Trustees approved the use of money from the reserved fund balance, which acts like a savings account, to fill the budget gap.
The school board voted to keep the tax rate the same at $1.3755 per $100 of property valuation. Northside ISD has not changed its tax rate in the past eight years. However, homeowners may still see an increase on their tax bill as property values climb. The district estimated the average homeowner with a house valued at close to $230,000 would pay $12.50 more a month in property tax bills next year.
Texas public schools are supported mostly by local property tax revenue and state funds. While property values have increased within Northside’s boundaries in recent years, the State’s share of funding has decreased. In 2015-16, the State funded about 37 percent of the district’s budget. In 2018-19, Texas will fund about 31 percent, according to David Rastellini, Northside’s deputy superintendent for business and finance.
Superintendent Brian Woods has been critical of the State’s school finance funding scheme. Individual taxpayers often complain that even as property values rise, districts face budget constraints, prompting questions about how the district’s money is managed.
However, in Texas, as property values rise, districts don’t necessarily receive more revenue; the funding formula between state and local dollars adjusts so revenue stays relatively flat.
“The way the program works is your [property] values go up, the State pays less, so you got to make it up somewhere,” Rastellini said Tuesday night.
That’s why Woods previously said that as the State Legislature enters a debate about changing the school finance system, it shouldn’t just look at property taxes.
“While yes, property taxes are high in the state of Texas compared to other states, if you look at the total tax burdens on individuals, that story is very different,” Woods said in February.
Other states don’t use property taxes and state dollars alone to fund public schools. Some also use revenue from income and sales taxes, two sources of revenue that Texas does not devote to education.
Woods said Texans’ total tax burdens are low compared to those in other states due to the absence of a state income tax.
Northside ISD is one of the few Bexar County area school districts that is still growing. In recent years, the rate of student enrollment growth has slowed, but the development outside Loop 1604 means growth is still occurring. As that area develops, the district must open additional campuses, including four new schools funded through a successful 2018 bond.