Financial Information

Financial Information

TAX IMPACT

At its peak, the 2017 Bond will cost $1.389 per month, or 46¢ per day, on a Kenedy ISD home valued at $100,000 (includes school and local exemptions).


Voters 65 and older will see zero tax rate increase on homesteaded property.


KENEDY ISD’S CURRENT TAX RATE

There are two sides to the KISD tax rate. The Maintenance & Operations (M&O) tax rate is $1.04. M&O revenue pays for salaries, utilities, routine maintenance, and other day-to-day operations. The State regulates what the district receives and can keep from M&O funds. When local property values increase, the state reduces its payment to the school district.  


KISD’s current Interest & Sinking (I&S) tax rate is $0.1455. The revenue from this tax is what the district would use to pay for this bond program. By law, I&S revenue can only be used for capital improvements and cannot be used for reoccurring expenses such as salaries and utilities. All the revenue generated from this tax rate stays in KISD and cannot be recaptured by the State for redistribution to other school districts or state expenditures.


Even with the tax rate increase from the 2017 Bond, Kenedy ISD would still have a lower total tax rate than many surrounding school districts:

District M&O Tax Rate I&S Tax Rate Total Tax Rate

Runge ISD $1.0400 $0.4600 $1.5000

Yoakum ISD $1.0400 $0.4490 $1.4890

Cuero ISD $0.9600 $0.4905 $1.4505

Kenedy ISD $1.0400 $0.3677 $1.4077

Pettus ISD $1.0400 $0.1984 $1.2384


THE 2017 BOND AND LOCAL INDUSTRY

Estimates show that local industry will pay 95% of the 2017 Bond. That equals $24,700,000. This means, only $1,300,000 of the bond debt will be paid by KISD residential taxpayers.

[Graph showing distribution of payment responsibility]


CHAPTER 41

Kenedy ISD is a Chapter 41 school district, meaning funds collected by the district are subject to recapture by the State for redistribution to other school districts.


The 2016 school year had an approximately 60% recapture rate in Kenedy ISD

  • Amount of Local Taxes Collected: $15,758,228

  • Amount “Recaptured” by the State: $9,354,561


There is NO recapture on voter-approved bond money.


If the $26 million worth of 2017 Bond projects were to be financed through M&O funds, and therefore subject to recapture, $65,000,000 of local tax revenue would be required.

  • $39,000,000 would be sent to the State.
    *It would not be possible to generate all the funds in one year’s time


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