GISD considers need and impact with Prop A proposal
School budgets made up of two main parts
Why a Bond Now?
It’s been 19 years since Graham ISD voters approved a school bond election. A recent assessment revealed that many GISD buildings have reached the end of their life cycle. As a result, projects have been identified as priorities in the Long-Range Facility Plan approved by the Board of Trustees on August 11. During the planning process, however, the committee identified $165 million in potential projects. The Facility Planning Committee then prioritized these projects and categorized them into what they considered to be “Must Do” and “Need To Do” lists.
The Nov. 3 school bond proposal addresses $60 million of the $165 million in identified projects. Bond elections may only be called in November or May. Historically, construction costs have been subject to inflationary increases over time. The District decided to call a bond election for November 2026 in an effort to minimize the risk of construction cost increases. The Facility Planning Committee recommended calling a bond election as soon as possible, which aligns with the community survey.
$60 Million Focused the Committee’s Highest Priorities
The District’s financial advisor projects that approval of the bond package would result in a debt service tax rate increase of 5 cents. This is anticipated to equal less than $3 per month on the average valued homestead in GISD.
As a note, residents 65 and older have their taxes frozen
if they have a homestead exemption in place and have not made improvements to their primary residence.
What Could Prop A Mean for Your Taxes?
Enter the appraised value of your home to estimate your Graham ISD school property taxes and the potential monthly tax impact of Prop A.
Two Parts of the School Tax Rate
School budgets and tax rates are made up primarily of two parts:
Maintenance & Operations (M&O)
Supports the district’s day-to-day operating expenses, including salaries, utilities, fuel and instructional costs.
Interest & Sinking (I&S)
Also known as debt service, I&S is used to repay voter-approved bonds for major facility and capital projects. The proposed bond election only impacts the I&S part of the budget/tax rate.
Understanding the Tax Impact
Average GISD Home Value $211,859
The Graham ISD local tax rate has decreased 31 cents since 2021. Approval of Prop A would increase the local tax rate by five cents which equates to less than $3 more each month for the average GISD taxpayer with a homestead exemption. The district has a history of refinancing and paying debt down early, saving taxpayers millions in interest.
Tax Rate History for Graham ISD
Who Sets the Tax Rate?
State law imposes various limitations on the District’s Maintenance & Operations tax rate, while the Graham ISD Board of Trustees sets the Interest & Sinking tax rate. The district does not set property values, but it does adopt an annual tax rate.
Why Use Bonds for Facility Projects?
School districts are required by state law to ask voters for permission to sell bonds to investors in order to raise the money required for projects such as building a new school or renovating existing buildings. Voters are giving permission for the District to take out a loan and pay that loan back over an extended period of time, much like a family takes out a mortgage loan for their home.
The public school funding formula in Texas provides funds for the day-to-day operations of school districts, but the District does not currently receive State funds allocated towards capital improvements. Graham ISD uses approximately 80% of those operational funds to cover employee salaries and benefits. The remaining approximately 20% is used for instructional supplies, regular maintenance and repairs, utilities, insurance, and other similar expenditures. Funds are not allocated in the state formula to cover larger maintenance and capital expenditures, so school districts generally use bonds as the primary source of funds to construct, maintain, and upgrade facilities, and purchase capital equipment.