Voter-Approval Tax Rate Election

  • LTISD voter approval tax rate election November 2, 2021

    What is a Voter-Approval Tax Rate Election or VATRE?

    State law requires that school districts seek voter approval to raise their tax rate above a prescribed amount. The election is referred to as a Voter-Approval Tax Rate Election (VATRE).

    Why call a VATRE?

    There are several reasons Lake Travis ISD has called for a VATRE:

    • Total tax rate stays the same so taxpayers get the advantage of the Maintenance & Operations tax rate compression
    • Increase of local revenue generated by additional two pennies is allowed to remain in the operating budget
    • $3 million will stay local annually
    • Interest & Sinking tax rate decrease has minimal impact on future bond capacity due to continued property value growth

    Tax Rate Components:

    • School districts total tax rate is comprised of Maintenance & Operations (M&O) and Interest & Sinking (I&S) tax rates
    • In Texas, funding of public education is by means of local taxes and state funds and is based on daily student attendance and attendance in certain programs
    • Amount of local tax revenue generated is based on property value appraisal and total tax rate levied
    • Property values used to determine homeowners annual tax payments include a 20% local Optional Homestead Exemption resulting in tax savings of $25 million

    Tax Rate Components and Allowable Uses:

    1. M&O Tax Rate

    • Predominantly for staff salaries and benefits (85% of budget)
    • Student services
    • Contracted services
    • Intructional material and supplies
    • Staff development
    • Utilities
    • Maintenance of facilities

    2. I&S Tax Rate:

    • Can only be used for payment of principal and interest on bonds sold to construct and furnish school district facilities
    • Early redemption of callable bonds resulting in interest savings
    • Cannot be used for operational costs such as staff, supplies and instructional materials

    Estimated Local and Revenue & Recapture Payments

    Two additional Golden Pennies with approved voter ratifications increases the amount of local revenue retained in general operating budget.

    Estimated local revenue and recapture payments

    Potential Uses of Additional Funds

    • Sustain additional instructional support positions for students and staff and tutorial services for accelerated learning once federal pandemic funding has been depleted
    • Safety net against possible loss of Fast Growth Allotment of $2.7 million if student growth slows down
    • Balance general operating budget when no new state funding is allocated through legislation
    • Maximize opportunities available int he current school funding formula for the benefit of Lake Travis ISD students and programs

    Lake Travis ISD Tax Rate History

    School district tax rate compression each year due to percentage of property value growth:

    LTISD tax rate history 2016-2021