Clear Creek trustees propose tax rate increase

LEAGUE CITY — Clear Creek public school district trustees approved a proposed tax increase of 4 cents per $100 valuation.

Trustees will hold a public hearing in late August before voting on the proposed maintenance and operations tax rate of $1.04 in September.

Superintendent Greg Smith said the district needs the extra 4 cents to cover rising costs, such as fuel and utilities.

“We’ve exercised significant restraint by not trying to increase the tax rate,” Smith said. “But times are tough, and the economy is slowing down.”

Smith said he thinks the community will support the increase because Clear Creek public school district provides a quality education and prepares its students for the future.

“We’re a great bang for their buck,” Smith said.

The 4 cents should bring in an additional $9.2 million, said Paul McLarty, the district’s school finance director.

If trustees approve the increase in the fall, the 2008-09 tax rate will be $1.36 per $100 valuation, including the part of the tax rate dedicated to debt service. That’s about 3 percent higher than the 2007-08 tax rate of $1.32 per $100 valuation.

If the increased rate is approved, a resident with a $100,000 home will pay $1,360 in school taxes, about $40 more than that same taxpayer paid in 2007-08.

Three years ago, before the state changed school finance, Clear Creek public school district’s maintenance and operations tax rate was $1.50.

House Bill 1, passed in 2006, revamped school finance and required that districts lower their maintenance and operations tax rates to $1 per $100 valuation. That tax rate does not include the rate dedicated to debt service.

The law allows districts to raise the maintenance and operations tax rate by up to 4 cents without voter approval to cover discretionary spending. The law also allows districts to raise the tax rate to $1.17, 13 cents higher than the mandated $1.04, with voter approval.

More than 90 percent of Texas school districts have increased tax rates by 4 cents already to cover rising costs, according to the Texas Comptroller’s Office.

Clear Creek is one of 14 districts across the state that has not increased the rate by 4 cents, McLarty said.

Since 2006, the district has been able to balance its budget, while still adding money to the district’s reserves each year, without raising the tax rate.

Inflation and the rising costs of fuel and utilities are forcing the district to increase the tax rate, McLarty said.

Fuel costs, for example, have doubled. In 2007-08, the district planned to spend $1.2 million on fuel. The district actually spent about $2.4 million, McLarty said

Last year, trustees passed a budget of $249 million. McLarty is still hammering out the budget for 2008-09, but said the district will likely need a budget of $258 million to cover expenses.

About 85 percent of that is personnel costs for the more than 5,000 teachers and support personnel who work at the district.

Along with increased expenditures, the district is also expecting increased revenues. Clear Creek public school district is planning to admit 800 new students in the fall, which means more state dollars since the state doles out school funding on a per student basis. The district is also expecting to increase its taxable wealth by 6 to 7 percent because of new construction in the area.

The district has trimmed costs in the past few years, including using software to find the quickest, most fuel-efficient bus routes and hiring an energy manager to reduce energy costs, McLarty said.

The district is also charging more for outside entities to rent school buildings, he said.

The cost varies per building.