001Heavenly Father, I thank you for this day. Thank you for our district. I just pray that you would continue to watch over and bless us. Be with us as we make decisions in the best interest of those we serve. Want to thank everyone for being here tonight. Um the uh this is the public meeting to discuss the 202526 U budget and tax rate. uh notice of this meeting was posted in the newspaper in accordance with statute and this meeting is really for public comment and so what you're going to hear um is a lot of it's the it's the same I had prepared some slides but we'll probably move through those pretty quickly um but in just in case I need to clarify anything so uh we're just going to take a a few minutes
002to make a couple of points um we will be talking about uh the proposed budget, proposed tax rate, and then uh the potential call for a voter approval tax rate election. Um this is the same slide as uh last week. The only additional bullet is there at the bottom. The proposed school nutrition budget is in this packet. Um there is a proposed deficit there and I'll I'll talk a little bit about that in a second. Um this slide is also the same as uh last week. Just pointing out that our general fund revenue increased um from year to year, $6.26 million. Most of that state revenue and most of that state revenue is the u teacher retention aotment. And then there's a few other things driving that local revenue increases. Um mostly taxes. Uh the
003two bullets underneath that um are all related to taxes. There's a few other things in that, but it's mostly taxes and local revenue. Um most of that is driven by a proposed tax rate increase of 4 cents above last year's rate. And then the federal uh revenue transfers decrease there. Um that is based on that is us backing out of our dependence on federal funding within the general fund uh because of its unreliable. Some of those programs that are in there are unreliable at this time. That does not uh impact our title funding, our um our idea B for special ed or anything like that. That's just uh some small things um federal funds that flow in to our general fund. So that's uh we're not depending on that. This slide was also included last
004week. Um you'll notice that the net increase in expenditures from year to year was uh significantly less than the increase in expendit in uh revenues. Uh the revenues were were greater to make up for last year's deficit and help us to uh to balance between the two years. So we had to have more revenue more of a revenue increase than expenditure increase this year. Debt service, as I mentioned last week, um debt service can only be used for principal and interest and some small uh other bond costs there. So, um we do have a deficit budget, but that doesn't mean what it means in some other funds. We're actually using that deficit um to help us manage the tax rate. Um we we'll be dipping into fund balance to help us manage the tax rate
005and uh manage that for our taxpayers. The school nutrition uh budget deficit. Uh consider this kind of a little microcosm of what we've been talking about for the past four months and and even beyond that for the general fund. Um what contributed to the uh the deficit in school nutrition is a loss of grant funding and then increased cost um mainly food cost and and then the raises the the salary increases. So you can imagine um sounds familiar loss of funding, loss of revenue, increase in expenditures kind of like everything else. We are um the board did adopt a price increase um for meals this year uh this coming year that was approved or I guess this current year now uh that was approved at a previous meeting and we're hoping that that can help
006chip away at that deficit. Um unless it uh it was a moderate increase so we're hoping it doesn't uh have a detrimental effect on participation also uh enrollment increase we would look for participation increase there also the proposed tax rate on the M um same this is the exact same slide as last week 78.69 69. That's 4 cents higher than the prior year. Debt service is the same rate as the prior year. So the total rate is 4 cents higher uh at 96.49 per $100 valuation. Just to revisit the tier 2 pennies discussion um to support the the budget at the levels that we have budgeted here and proposed to you, the district would need to call and pass a 9 cent uh voter approval tax rate election. We're currently taxing five of those pennies
007uh due to the uh disaster relief provision the prior month. I mean, I'm sorry, the prior year last summer. And so if the uh uh so what we were asking is we would ask you to call that election and then if it passes or once it's on the ballot we're going to that would be asking the taxpayers to uh let us keep those five pennies that were already taxing and add four more to it. Uh if the BATRE does not pass, the difference would be about uh $2.56 million and uh we would lose that much revenue and that would result in a deficit budget and then we would uh need to look at other measures to limit that that deficit unless we chose to just absorb absorb that with our fund balance. Um do want
008to point out that our tax on average residents even with a 9 VATRE would be a uh decrease of $246.81. That's due to the uh proposed um homestead exemption increase that will be also on the ballot in November. And then uh I think it's important to note that our over 65 and frozen levies um would be would not be impacted by this unless the calculation yields a an additional savings to the taxpayer. So um no impact unless it's positive for a taxpayer there. And then I did want to revisit this slide just briefly. Um I do not have our 2526 rates to compare with uh with our neighbors. Everyone's going through this process right now. But these are the 2425. You know, last uh last week we mentioned that we are the third lowest tax
009rate currently. Um we would project with this that we would be the fourth lowest uh tax rate of any district that has taxing authority in Smith County. um with the 9 cent VAT. Um subsequent to our meeting, you might have seen that uh troop uh troops board on Tuesday night decided to call a u bond election. And so that was I believe for $22.2 million. And um if passed, they project that that would uh increase their tax rate by 28 cents. And so there would be a little bit of jockeying of this and and maybe we would retain that position at a little bit lower than fourth. But anyway, um at this time, uh if there's any questions or comments or public comment, um any clarifications, we can entertain that. There would be more savings.
010That is correct. Another $169 there. So, it would be uh $415 $416 uh in total savings. No. Uh for the average residents for the year, for the year, the average residence has a taxable value um that we got from Smith County Appraisal District about $187,000 is the taxable value and that is calculated with the $140,000 homestead exemption or the $200,000 homestead exemption as if it had passed for um over 65. So, um, we would be looking at about a $2.5 million or $2.6 million deficit. and we could probably um absorb that for uh in addition to what we're going to absorb this year as a deficit. You would be looking at four years of that. But of course um well before that we would start running um a little bit too low on our fund
011balance. Um you know our our prescribed fund balance uh recommended best practice is three months of operating. So that's about um in in this scenario that would be um about 14 million million dollars. No, the the current is um is under two million, right? I mean it's 1.75 and then um yeah, so that would actually be that would actually grow a little bit because Think about it. We We have those five pennies and if this doesn't pass, we would actually lose uh lose pennies. Yes. >> And and if it didn't pass, we would begin we we've, you know, attrition several positions this year and been able to not necessarily let anybody feel that that impact students, but to to reduce that deficit is going to be a little bit more aggressive than just, hey, if
012you're retiring, we're not your position. It's going to and more of a wholesale position control uh how do we staff and definitely more aggressive approach. Um I'm proud of Clint and our team and our HR team is we've done a really tried to make sure that we're thoughtful about how we how we positions how we cut some cost. It's just to cut that kind of dollar. It's going to take a little bit more than what we're currently Okay. This would be permanent. This would be permanent if uh if it's in the election. I mean, that would be we would have those pennies, you know, we've passed two of these in the past and we passed it for two pennies at a time at at that time because we were after golden pennies and we still
013have those pennies. So, appreciate y'all. Thank you. I'll just mention on that that um because of the tax rate that you just approved uh it will necessitate a us calling the voter approval tax rate election the prescribed wording for that um is in the call and that's included in your packet and the required tax rates and calculations are in that call And so we're asking you to approve uh the order to call the VAT on November 4th, 2025. Yes. I'll just say that we uh typically contract with uh Smith County. They administer our elections. And so uh we're asking you to approve the interlocal between White House ISD and Smith County uh to conduct the election on November 4th.