001I call this Manina Valley ISD special board meeting to order at 7:18 p.m. on August 13, 2025. We have a quorum of board members present. Absent board member is Mr. Bonnie. We'll begin with a pledge of allegiance followed by moment of silence. Next we have is public comment. We have no one signed up to speak. So move on to discussion of possible action items. We'll begin with consider approval of the schedule for the valley ISD 2526 public hearing for the budget and tax rates. Mish. So, as we talked about in committee, um the one action item we have for tonight is just to set the date, place, and time for our public hearing um to adopt the budget and tax rate. And so where our consideration for the evening is that our maintenance and operations
002tax rate would be 65 or 0.6527 um consisting of our maximum compressed rate calculated by TEA of 6027 plus the 5 cents um of tier 2 enrichment pennies and the interest in syncing tax rate would remain the same at 50 cents. and a copy of the P notice for public meeting was was discussed prior and you all have a a copy of that as well if you have any questions. Um, we are recommending August 25th at 6 PM in the Medina Valley boardroom for the public meeting to discuss the proposed 2526 budget and tax rate. And administration also recommends that the maximum tax rates that can be considered for 2526 fiscal year be 60.6527 6527 for maintenance and operations and 50 cents for the interest in syncing fund for a total tax rate of 1.1527
003per $100 of property value. Do you all have any questions? >> If not, I'll look for motion. I, Matt Calleone, move to approve August 25th, 2025 at 6 PM for the Medina Valley ISD 2025 2026 public hearing for the proposed 2025 2026 budget and tax rates and the maximum tax rates that can be adopted for 2526 as presented. >> I have a motion to have a second. >> I Joe Beer second the motion. >> I have a motion and second. Any further discussion? Not all those in favor raise your hand. All board members voted for and the motion carries. Next we have a budget workshop. >> Move it. >> Perfect. >> All right. So we are going to start kind of um just big picture overview. Again, we show this usually at all of our
004budget workshops, but as you can see, we started this process really back in December, January, and we have met August. And so, and we just completed the set the date, place, and time part. So, our next um meeting on August 25th will be to adopt the tax rate or and the budget as well. And this is this is where we are in the board meetings and we are right on track to to be able to move forward with our 2526 budget. As Whoops. As just a re I don't think I I don't think I did it, but as as a reminder, we really are when we're building the budget, we're really looking at our strategic priorities. As you all know, with with new legislation that passed with teacher compensation and raises, um a s like
005significant changes were being were able to be made to the compensation plan. Um I know as of start of school, we had positions filled. All of our teaching positions were filled a while ago and most of our auxiliary positions are filled as well. So, I know that everything we do on the compensation side and building that into the budget is is definitely helping us with the retention and recruitment of our of our teachers is one of our main priorities. There are also a lot of programming pieces and um professional development opportunities that are funded um to help with the initiatives on every student grows every year from PLC conference to um some of the blended learning programs and things that we're utilizing in our classrooms. Obviously, we've talked a lot about parent engagement um and
006using student square moving forward to those platforms and just all of the outreach that that that group is doing. Um I know Miss Vieira does a tremendous job and was helping me with last minute things as well. So they um to get everyone involved and and so we focused on that as well. And then finally, there's obviously a lot of pieces with finance and construction and facility projects and creating equity um that we are looking at in the finance and operations pieces. And we'll talk about some of those projects as we move through the budget this time. I did not make a copy of this presentation. So now I'm out of things to say. So we're gonna have to wait a second. I usually bring a print out just in case and I'm like, okay.
007I'm like, but not today. And it's going to be a lot of numbers. I can't wing it. No. Um, the one thing that we did do, so we sent you all out some information on Sunday. Since then, I was able to meet with Mo Casey, who does some consulting and had them review our our budget template and how we were looking. Um, the one thing that we that I agreed with them to tweak was our state values. So, as you know, we have our local values and that impacts our collections. But then on the state values, that impacts what how much you're going to the state is going to give you credit for locally versus how much the state is going to pick up. And because our freeze, our frozen levy decreased by about half
008with the new 140k Oh, you're the best, Scott. Um 40k exemptions. um they they recommended that our our state values probably are going to be a little bit more than the 4.9% increase because um the levy loss from the frozen is going to go down because of because of the homestead exemption. And so because of that, we did reduce our revenue a little from what we sent out on Sunday and just and then we just made um we reduced some of the capital projects as we talked about in committee. So, just wanted to kind of give you a little heads up if you did a lot of homework this weekend and then something changed. Um, that's why. So, here are our budget assumptions that we've been using throughout the budget process. We're using actually even
009the fourth quarter demographer report and it didn't change over o from the third quarter. We it's still estimating 10,617 students. Um, we used an attendance rate of 92%. we ADA we're backing out half of our prek because we get half credit for for prek and so that gives us an ADA of 9512. Um we're using 98% collections for our local collections and then that property value growth is the number that changed um once with the 140k exemption. So we had been using 10% and then with the 140 it ended up being 4.91. Um, and then as much of new law that we know is in place out of House Bill Two from this latest legislative session. And then you all saw this slide earlier as well, but this is your certified property values. Um, the
010tax rate is based off of the difference between the 5.9 in 2024 and the 6.2 in 2025. We did increase our protest um a little bit over last year um to make sure that we're covered for any changes that happen between now and when the levy and this the tax statements actually go out. Um giving us so we're using the 6.1 when we're budgeting what our local collections would look like. And then here, this is just kind of interesting information, but it is giving you the breakdown between Medina County and Bear County on the what percentage of our collections are residential um and commercial. And that just gives you kind of a a piece of where we are. um Beayer County was starting to to get a a significant g gain is as more development
011is going on in that. But with the homestead exemption, you can see that they're now pretty much at just around $3 million, the same as Medina County. So, this is kind of what that looks like just to give you kind of a snapshot. Um we see a little more in the commercial with the additional homestead exemptions in play um than what we did before. And then there's just the look at the tax rate that we talked about a minute ago. Most of that is is kind of calculated for us with the 60 um the 60.27 cents in the maintenance and operation. The only the only piece that the district would really have an option on is if they wanted to do a TR election and increase those five pennies. Um but that's not something that
012we are looking to do. And then here's just kind of an overall look at what our tax rate has looked like over the last several years. As you can see, since the passage of House Bill three back in 2019 that instituted tax compression as values went up, um the taxable the tax rates have continued to go down um since then. And we are we're sitting at the 115 um 27 for this la this next year. And then here's just kind of a quick look at our at our projected revenue. So, we had been looking at about 114 million. As I said before, we tweaked that down just a little bit to make sure we're not overestimating um our state aid. Um, but we're seeing because of the homestead exemption, again, you're not seeing a big
013gain in the local property taxes, but you're with all of the House Bill three or House Bill Two legislation that recently passed with the teacher um pay increases um we're seeing a and our gain in a thousand students. You're seeing about 11 million um in state aid. the the change down in the federal revenue is from -ate funding that we had this year that we're not necessarily anticipating for next year. And then on the projected expenses, um this is just kind of a a big picture overview. As as you know, we'll be adopting the budget by function, but this just kind of gives you those main categories and where where the money is is going. And so obviously our biggest increase is going to be in payroll for for the new teachers we hired as
014well as compensation um going into next year. And then the second probably area is then your capital outlay. And so that is including the capital projects that we've talked about and we'll kind of talk a little more about those as well. And so that is that's kind of where where it's being dispersed the additional 13 million in revenue. And then I wanted to give just kind of a fund balance. We're anticipating a fairly break even fund balance at this point. We'll know more as we finish making those final final payments and closing out POS over the next couple weeks and we'll keep you posted. But I would say it's this or something slightly better um at this point. And here is I always think this is kind of a good graphic to show like what
015cash flow looks like basically for us throughout the year. So the at the beginning of the year we're we're re and so orange is this last year. So 23 24 was was prior year and you see mostly a similar trend where you see some differences in that September October is generally if you are ahead or below the state it's settle up. So, at the end of September, they give you your final settle up based on your ADA from the prior year. And if you if you got a little extra because you came in low, then then you probably see a little more of that bell curve. If you owed the state some money, then you're going to see a little bit of a a dip. Or if the auditors had to make any adjustments um
016while they were there, that would have happened in that time frame. But I think the orange is a pretty normal curve. we get we start going down in December and then we receive the tax revenue on the local side. Um and that kind of shoots us up and carries us until we we level back out um in July and August. Um also good our cash balance never dropped this year below the 29 million. So fund balance at any given month was not below 29. Our 25% of our fund balance would have been that 24777. So we um we are still well above um what the required or what the 25% of our fund balance would be even going into next year. This was the list of capital projects that we've talked about. Um obviously this
017is just for workshop purposes and we talked a little bit about potentially moving moving the Hback into the bond and adding some of the other projects that we've talked about. Um but here's kind of what we have currently in the budget. So when you're looking at the by function you're seeing um those projects um fitting into the function that they would be utilized. So buses are function 34, HVAC is a 51. So some of that just kind of gives you an idea when we look at it by function why some of those functions might have increased over the prior year for some of those bigger projects. um debt service. This is so well I'll take a pause. Does anyone have any questions on the M or the maintenance and operations piece? I know we kind
018of went through that quickly because we've talked about it a little in committee as well, but everybody's good. Okay, we're going to rock and roll through. So, this is this is our debt service fund. Um and so again, we're collect we're um budgeting based off of those local property values. So you're not seeing a huge increase in our local property tax tax collections for next year for debt service, but where you're seeing the bump is in the state revenue for that um hold harmless money essentially. Um and so that is and the 36695 is what we're estimating is our as our debt service payment for next year for the most part. Um, so this is where you're seeing where you're seeing the biggest revenue increase. We do want to be mindful that we we'll be
019waiting for TEA to run those calculations on the hold harmless list and and be able to update those here in the fall. And then there is there is the estimated payment for next year um interest and principal. And then there are always some minor fees that come across. Again, our fund balance is going to be fairly equal. We had talked about at one point seeing an increase in the fund balance from the interest that we brought over for the defeasants. And after talking to Mr. Kuroga, our financial advisor, we're going to decrease the amount of interest we bring into debt service to just match the payment. If you remember in legislation, they talked about penalizing you on the hold harmless side if you didn't use all the local money to make payments. And so we
020just don't want to take any chances that we're going to be penalized and not receive as much state aid. Um and then we can keep those funds in the bond fund balance um to potentially use for future defeasants if we needed to. So PL So we should end up fairly um break even or similar fund balance because we want to maintain what we have but we really can't increase it um without potentially having a penalty. And then for child nutrition, um the budget for next year is fairly similar as we are reconciling this year's budget and we've looked over things. We we are we probably budgeted about a million million and a half extra in revenue and it's similar in the expense side. And so next year's budget even though we're planning we're growing is
021not increasing that much over the prior year. Um the difference in the federal revenue is that we are we're using an indirect cost rate and so that that is the net is is generally that's about what is being applied to the indirect cost which are basically the child nutrition fund can pay the general fund for maintenance and operations finance HR all the services that we provide. Um, and that gives a little bit of a bump and they have a a good fund balance. So, so we're we're comfortable with that. Um, and then on the food service side, um, we did bring down that budget. Again, I said that we were we were overbudgeted and even with this, we still have about a million dollars in there that would be um, fund balance spendown projects. We
022know right now the cost, we have a walk-in cooler that needs to be repaired. We have a a portable truck out there right now for refrigeration. Um, and I think Lucky Ranch has a has an issue with their walk-in cooler as well. This also has some funds in there for startup at Creek View. We can purchase small wares, your small equipment, slicers, and can openers and and all of those things out of out of her fund balance as well. Um, and so we're going to utilize some of that just to make sure that we're keeping that fund balance not over the six months. It is six months. >> It is six months. It used to be the 25% the same as as the other and now it they'll let you carry six months and so
023um so we are going to adjust adjust that piece. Um currently we're looking she had we had built in a pretty good spendown last year and I think we're still going to end up with putting a little bit more into fund balance. So, we're going to make sure we take care of some of those big equipment things that that we're having issues with um next year as well as help with with Creek View opening. So, still planning on a fund balance this year, probably just under $3 million. And we'll see how August goes because obviously a lot of people make payments when they first come back. Um the other really significant thing um her last year we had our bad debt was around I think it was around 65 or 70,000 and this year we're
024in the the back to 35 after the policies that we put in place. So that's also looking good as well. Um this is a copy of the over 50 list. We I know we may we didn't get to it quite in finance committee and but in the slide deck that we'll share with you it had the link that showed all the description for each one of the vendors what they what these purchases were for and so it is a little bit easier to kind of view that. Um but any of if there are any of these that you have questions with before the next meeting definitely able to talk to or address um any of these. Most of them are very similar to last year. Um some of the things that we added were our
025auditor, our legal counsel, the tax appraisal district um and tax office. Um but most otherwise most of these are very similar to the to the prior year. And this is in your book. Sorry, I had the page number marked earlier. Get there on 2020 and 21. And the the work Excel worksheet that was shared on Sunday as well as um in the committee presentations has the what what all these are for. A big chunk of them are child nutrition. It's for food. Um, so some of those really big ones from Labat and so on are are food. Oak Farms, Labat, all of those are are for food. >> What What is Flowers and what is that one? >> You know, we talked about this one last year and it threw me too because I hadn't
026used it, but it's tortillas. >> Like the name of the company is Flowers that does our our tortilla bread and tortillas. Yeah. >> Okay. I know. >> Cute one. >> It's like, wow, we spend a lot on flowers. >> I know, right? And they're all of most of these are are pretty much on the they're either a professional service or they're on a cooperative. So, >> yeah, the 240 the 240 was the one that like what is >> I know, right? >> And G Coast, was that the one that we did? They did electrical upgrades for us or is that >> This is also for Tiffany and it's paper. It's the paper goods for child nutrition. So, she really has about six or seven vendors she uses off of the off of the region 20
027co-op. And so, her dollar amounts are pretty high because it's pretty much those handful of vendors. Is there anything else that's catching your eye? I was like, there's a few of them. >> The insurance. >> Yeah. Yeah. >> It is. It is. Okay. Then this is really just the when we adopt um on the 25th, this is kind of what you adopt off of. and it has all three of our um funds that we must adopt and and by function. And so obviously the debt service fund is all in 71, the child nutrition is all in 35, but then you see all the other functions um in here. I would say on page 23 of your of your book, there is a really good comparison from last year to this year by function. So you
028can see the percent of total budget in compare most of them um it's really function 81 which has some of those capital projects in um that you see a little bit of an increase and so consequently some of the other ones have to have a decrease um but it's you it's they're pretty minimal um going through um and you can see the dollar amount differences as well. Um, to me, that's the best way for me to check to see if I'm missing something or if I've accounted for everything is if something went down that doesn't make sense to me that it went down. Um, but for the most part, their percentages are staying fairly in line with the prior year. And most of the increase to the budget is really in payroll. So that's where
029and it's split split throughout all of the functions for the most part. So that's where you see them staying fairly steady. But that sheet is a is a good one to kind of dig a little bit deeper into. Probably a little better than the other one. And then that is what that's what I have for y'all. I know there's quite a bit more in the in the workbook. I would say behind like where the where kind of the sticky note is, it kind of goes into the supporting documents and it really show lays out the pro the certified values are in there, the demographer reports in there basically how we got to where we are. There's a copy of the compensation plan and just revenue projections. Um, so you can kind of see see however
030the sausage behind it if you if you so desire. But I will take any questions you all have any changes to bring back before approval. >> Yeah, just I mean going back to the page that you mentioned that shows the comparison of the prior year >> the changes in some of those functions. What like data processing services went down a lot. Was that a movement between functions or was that because we streamlined something? Scott, can you remind me on on your 53 that went down? There was a like we went up in the instructional devices, but we went down in the function 53 and I'm trying to remember why. >> Yeah, I mean, we can talk about this in subsequent deals. I just curious on how we came up or how the new budget numbers
031came up. Yeah, I did have that one on my list to verify because I was I knew that it went down. I just I'm forgetting exactly what the backup reason for that one. >> The other one was social work services that went down. >> We we have had a few social workers that um have left and those are a position I think that we're reallocating more to counseling than social work specifically. I think they were added during the pandemic. Yeah, it's just odd to see things go down when they're growing growing so much. So, >> it's generally when it's staffing related. Child nutrition is the capital projects that we paid for this last year um with the furniture and the tables and things like that. >> Well, we couldn't afford a lot of that last
032year and stay in the black. So, >> that is very true. >> This year we, you know, we have to do it. The only thing I have is we talked about for the other board members, we talked about in finance committee potentially and Crystal said it maybe moving the HVAC stuff out of the 199 budget and moving it over to 23 bond funds with the excess. That way we're not, you know, so we can make sure enrollment and everything else hits and then after the snapshot. So >> ultimately we'd be creating a a budget with >> we actually brought that up too that I mean you're looking at 25 year life on HVAC equipment. That's something that's tolerable using bond funds for. So, >> and it can potentially give us some more flexibility once we
033get that information back from MEP on what the what an ideal project schedule would look like. >> Correct. >> Well, there's still a lot of uncertainty with equipment prices, too. So, we got to be a little more conservative, I think, still on that kind of stuff. Any other questions, >> comments, thoughts? >> Well, I I just want to thank them. I mean, the fact that we've stayed in the black last year going over the end of year proto proposed budget amendment for last year. I mean, I I think that shows that you guys have done a really good job tracking and keeping us aware of that because there's not many districts in the state that that did that. So, I mean, good good job to you guys for that. So, >> it's a it's a
034good time to be growing. >> Okay. Next on the agenda is a journment. I'll look for a motion. I Blaine Nash move to adjourn the special board meeting at 7:47 p.m. on August 13, 2025. I >> have a motion. I have a second. >> I Ben want to second the motion. >> I have a motion to second. All those in favor. >> Thank you. All board members voted for and we are adjourned. Thank you.