School districts that owe recapture to the state and do not generate enough state aid to “net” recapture typically make a single payment before the end of the fiscal year in August.

Under state funding formulas, LISD cannot lower the tax rate enough to avoid recapture. Taxing below a certain rate (known as the state-approved Maximum Compressed Rate) causes a loss in funding and even more recapture.

The short answer is TEA is using an estimated property value increase of 4.36%. They will update their data in February. The actual property value increase is 27.05% which will equate to a recapture payment of approximately $31.2M which is greater than state revenue of $17.7M and as such the payment cannot be offset against state aid. Thus, LISD is required to conduct the Prop A election to authorize the method by which Leander ISD makes the required recapture payment.

Here’s the answer in greater detail. Leander ISD received a letter from TEA that states the district will exceed the district’s entitlement under Texas Education Codes (TEC) §48.266(a)(1) and/or TEC §48.266(a)(5)(B), which essentially means Leander ISD will owe recapture. The letter also states that the “determinations for districts subject to recapture are based on:

• estimates of enrollment for school year 2022–2023, and 
• estimated property values for tax year 2022. Because the agency does not yet have final state certified property values for tax year 2022, the agency is using 2021 state certified property values increased by 4.36%”

TEA is using estimates of enrollment for 2022-2023 which were required to be provided in December 2020. Subsequent changes in enrollment and attendance projections are reflected in the district estimate, but not in the estimate TEA is using. Also, the data utilized by TEA does not reflect the 27.05% property value increase, it does not consider the final certified “Tier One Tax Rate” (MCR), and it does not account for the copper pennies that are being requested via the VATRE.

The letter from TEA also states that the final determination for the recapture payment will be made based on “using the district’s:

• final enrollment, entitlement, and local share under TEC, Chapter 48,
• final state certified property values for tax year 2022,
• adopted maintenance and operations (M&O) tax rate for tax year 2022, and
• M&O taxes collected by your district in 2023.”

LISD requested the Texas Association of School Business Officials (TASBO) to run the calculations based on up-to-date information; i.e. 2022 certified property values, enrollment, and assuming the VATRE passes. The results of that calculation can be found in this updated calculation, recapture is estimated to be $31,216,055. 

In February 2023, TEA will incorporate preliminary certified state values, the certified tax rate, Fall enrollment, and budgeted tax collections in their calculations and will provide a new excess local revenue estimate. The recapture amount owed by Leander ISD will not be finalized until August of 2023 and will be based on actual enrollment and actual property value as certified by the comptroller’s office.

Proposition A is a state-required vote in which residents of the district approve the method by which Leander ISD sends recapture dollars to the state. The purpose of recapture is to provide roughly equal amounts of revenue per student across the state, as required by prior Texas Supreme Court rulings. It is often referred to as Robin Hood.

Proposition B is an opportunity for LISD residents to ratify the tax rate set for Maintenance & Operations (M&O) by the LISD Board of Trustees on August 18, 2022. If voters approve Proposition B, the total tax rate will be 9 cents higher than it would be if voters defeated Proposition B. The $32 million raised by Proposition B would fund recently enacted pay raises for teachers and other staff, and it would help prevent cuts to the LISD workforce and programs.

If voters pass Prop A, the district will proceed with making its required recapture payment to the state.

LISD estimates our recapture payment to the state will be $31.2 million for the 2022-23 school year.

Under state funding formulas, LISD cannot lower the tax rate enough to avoid recapture. Taxing below the state-approved Maximum Compressed Rate (MCR) causes a loss in funding and more recapture.

If voters reject Prop A, the state could embark on a Detachment of Territory, meaning that parts of the district’s property tax base would be taken off of the Leander ISD tax rolls, even though the district would still be responsible for educating students who live in those areas. In other words, a smaller base of taxpayers would be responsible for paying off debt and the district would have less revenue to fund education.

The passage of Prop B would provide an additional $32 million for education in Leander ISD. This revenue would help recruit and retain teachers and provide funding for the compensation plan that the Board of Trustees approved in May. The revenue would help protect against future budget cuts that could leave fewer teachers employed in the district and reduce the availability of academic programs.

It would raise $32,468,580 for the 2022-23 year. 

School property taxes are frozen for homeowners who qualify for an exemption based on age (65 or older) or disability. Their taxes can go down, but not up. Prop B will not increase frozen levies.

No. Bond elections are primarily for construction and physical infrastructure. The money raised from Prop B would go into classroom learning (including teacher salaries), rather than construction and renovation.

If voters do not pass Prop B, the district will need to make significant spending reductions that could impact instructional programs and cause a reduction in the district’s workforce in 2023-24. The failure of Prop B would also jeopardize future pay raises for teachers and other staff.

The overall tax rate, which is the combination of the M&O rate and the I&S rate, would be 6.24 cents per $100 property valuation lower than the rate for 2021-22.

First, state-mandated rate compressions have pushed the M&O rate down. With those compressions, under Prop B, the M&O rate would increase from 87.2 cents to 94.46 cents. However, the I&S rate would decrease from 46.5 cents to 33 cents. This significant reduction in the I&S rate is what would allow for a decrease of 6.24 cents in the total tax rate under Prop B.

Based on current projections, the district will need to make $29.5 million in spending cuts in 2023-24 if Prop B fails. $29.5 million equates to 458 teaching positions. 

No. The district will have to pay recapture to the state regardless of whether Prop B is successful.

Due to specific requirements in state law, Prop B will read as follows on the ballot: “Ratifying the ad valorem tax rate of $1.2746 per $100 of valuation in Leander Independent School District for the current year, a rate that will result in an increase of 35 percent in maintenance and operations tax revenue for the district for the current year as compared to the preceding year, which is an additional $99,041,063.”

Here are three important things to understand about the ballot language:

1. If Prop B passes, the resulting overall LISD tax rate of $1.2746 would be a $0.0624 decrease from 2021–22.
2. The ballot references the increased maintenance and operations (M&O) tax rate, but does not mention the more than 13.5-cent decrease in the interest and sinking (I&S) rate.
3. The revenue increase that is referenced in the ballot language reflects gross tax collections over the prior year. It does not consider recapture or the loss of state funding.

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The last day to register to vote is October 11.

Early voting is from October 24 to November 4

Election Day is Tuesday, November 8.

Williamson County voters can vote at any location within the county. The same is true for Travis County: Voters can vote at any location within the county they are registered.