The West Oso Independent School District board approved a property tax increase Monday night to pay off existing debt early so the district can potentially build a new middle school in the next few years.
The board met Monday night to approve a budget and tax rate for 2024-25. The budget includes a teacher pay raise that will increase the starting salary for teachers in the district to $51,500, with the district’s most experienced teachers receiving a base salary of nearly $67,000.
What impact does this have on taxes?
School districts set two tax rates: the maintenance and operations tax rate, which is used to raise funds for regular annual expenses such as salaries, insurance, utilities and supplies, and the interest and principal tax rate, which is used to pay off debt. Through voter-approved bonds, school districts borrow money and accumulate debt to finance major projects such as building new schools or renovating old campuses.
West Oso ISD’s maintenance and operations tax rate remains relatively unchanged this year at about $0.6669 per $100 of assessed value, compared to $0.6692 last year.
The Board has voted to increase the interest and principal tax rate this year from $0.3077 per $100 of assessed value to $0.45.
This means that the overall tax rate for West Oso ISD is now $1.1169 per $100 of assessed value, compared to $0.9769 last year, and the average homeowner’s tax bill will be higher.
For residents who claim a property tax exemption on their primary residence, the first $100,000 of assessed property value is not taxed under a constitutional amendment passed by voters last fall. There is an additional property tax exemption for residents who are 65 or older.
Because of this, the average taxable value of residential homes in WOISD this year is only $29,553. For the average residential home, the total tax bill under the new tax rate this year is about $330. Last year, the average tax bill for residents was $209.12.
Why is the district raising the tax rate?
The West Oso School Board voted unanimously Monday night to increase interest and tax rates to allow for early debt repayment.
The debt to be repaid is related to a 2018 bond package that financed projects such as a new district administration building, roof repairs for schools, safety improvements and new turf for the soccer field.
But in the future, the district will soon have to replace its aging middle school, said Superintendent Kimberly Moore.
Although it is still a long way off from developing concrete plans, the district must now begin laying the groundwork to improve its financial standing and possibly ask voters for approval to take on more debt to build a new school, Moore said.
The district has worked to improve its credit rating in recent years, Moore added, and improving the debt-to-asset ratio is another area for improvement.
Without paying down some of the current debt, the school district would have a hard time taking out another bond to build a middle school in a few years, said Tony Jaso, executive vice president of Estrada Hinojosa Investment Bankers, who advised the school board Monday night. The district also received advice from a bond consultant.
Revenue from the higher interest and the reduced tax rate will be used to pay off over $2.4 million in debt early. The additional tax revenue will be deposited into an escrow account to be used starting in 2028. With funds set aside specifically for this purpose, the debt will effectively be wiped off West Oso ISD’s books, according to consultants.
School board members discussed the proposal before voting Monday night, addressing the potential impact of the tax increases on the community and the district’s financial needs.
“We need this,” said CEO Velma Rodriguez.
Other board members shared and echoed this view.
“It’s necessary,” said trustee Shirley Jordan.
Depending on the district’s financial situation and needs, as well as voter support over the next few years, a new middle school could be built adjacent to the current, decades-old campus.
Budget plans and salary increases for teachers
The school board approved small salary increases for teachers, ranging from 1.5% to 4.1%, depending on experience.
For other positions, small equity adjustments were included in the budget.
In recent years, West Oso has struggled to afford raises for teachers. In 2023-24, staff received a 1.5% raise and the teacher pay scale was extended from 20 to 30 years to increase the salaries of the longest-tenured teachers. In 2022-23, the district did not offer a raise, although it did offer stipends to retain teachers.
Increased state funding, new grants and community partnerships are critical to the district’s future, Moore said.
“We want a future for our school district,” Moore said.
Recent research has shown that 73% of Texas school districts are underfunded. According to the national School Finance Indicators Database, West Oso ISD had a funding gap of about $9,500 in 2021, with actual spending in the district much lower than the amount research considers appropriate.
Moore said the district has cut spending wherever possible in recent years.
Funding for Texas public schools is tied to average daily attendance. In recent years, the district has struggled to accurately predict enrollment and attendance, resulting in higher spending than state reimbursements.
Moore said the district’s estimates are now back on track. If attendance drops, there will be financial consequences, Moore said.
The district had more than 1,790 students enrolled Monday, but the average daily student population last week was about 1,670. The district’s budget plans are based on an average daily student population of just under 1,650, Moore told the board.
Without increased government funding, the district had to rely on creative solutions.
Last year, West Oso Elementary School teacher Marissa Hernandez entered her school into a contest for a new playground. Although the school did not win the contest, the publicity resulted in donations from the TND Family Foundation of San Antonio, which the school used to build a new inclusive playground and take students on field trips.
Last year, community members created an education foundation to support teachers and students. The group is working to raise $85,000 in its first year for scholarships and tuition grants.
The district secured grants last year from the federal 21st Century Community Learning Centers program, administered by the Texas Education Agency, to fund after-school programs at John F. Kennedy and West Oso elementary schools and West Oso Junior High School. This year, West Oso’s after-school program will expand to the high school level.
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