F.A.Q on Finance

The annual Texas Academic Performance Reports (TAPR) reveal that Leander ISD is operating a lean Central Office and lean administrative team (i.e., Campus Principals and Assistant Principals) compared with peer districts and the state. These admin positions also have salary expectations that need to be competitive in the industry to hire and retain much needed school support. Even if all Central Office positions are cut, the savings won’t be sufficient to give teachers more than a 1% increase. But then who will run payroll, IT, etc.? LISD also employs a higher percentage of teachers than peer districts and the state average – a reflection of the broad program options and reasonable class sizes which are conducive to student learning.

The state has a formula to determine how much property tax revenue a school district is entitled to keep. Think of property tax revenue as really belonging to the state and they allocate the district its share. The entitlement amount is largely based on student attendance with a few other factors added in. The basic allotment of $6,160 for 100% attendance by a student has been fixed since 2019, with no adjustments for cost of living or inflation. Any property tax revenues the district collects above this calculated amount must be returned to the state in the form of recapture payments. The more property taxes collected, the less the state funding received. Last year, the state contributed about 20% of Leander ISD maintenance & operations revenue to fund salaries and other daily costs. This year, that percentage is expected to drop to about 10% state contribution, shifting more of the burden to local taxpayers.
No. The state controls the minimum Maintenance & Operations rate, and the district is already at that minimum aka Maximum Compression Rate (MCR).
A portion of the property tax rate is allocated towards Interest & Sinking (I&S). This is the debt fund used to pay down bond debt. Around 2013, the school district had accumulated about $3.5bn in bond debt from construction of several new facilities and the use of Capital Appreciation Bonds (CABs). In less than 10 years, the district has paid off about $1bn of that debt and has also switched to Current Interest Bonds (CIBs). The district is on the right path with guidance from the bond financial management advisors.
The bond financial advisers and CFO provided models showing the ability of the district to continue to meet current debt obligations, accelerate payments where possible, and issue bond debt to build new schools, even if property values drop. The I&S rate has been fairly stable for several years, even as property values continued a steady rise. The debt fund has a healthy fund balance which is not necessarily available to be used based on the bond repayment schedule.

In 2021, Fitch upgraded the district bond rating to AA from the previous rating given 9 years earlier. This change was a reflection of the significant reduction in bond debt and move from CABs. S&P also gives LISD bonds the AA rating.
In 2024, Fitch again upgraded the district bond rating to AA+ due to healthy unrestricted general fund reserves.
The Financial Integrity Rating System of Texas (FIRST) rates LISD an A for the 2022-23 school year.

There are lots of volunteer opportunities in the district – it takes a community effort to be strong! Advocate to your state legislators this upcoming legislative session, beginning in January 2025, for increased state funding to school districts. The more the state takes on to fund public education, the lower our property taxes. Research and vote for candidates who support public education at ALL levels of government.
Translate »