The Arlington school board took the first step late Thursday toward a 6.6 cent tax rate increase to pay for the first installment of the $663 million bond package approved by voters last month.
The money will go toward principal and interest on $173 million in bonds for construction, safety, security and technology improvements, fine arts equipment, uniforms, buses and fleet vehicles.
Trustees voted 6-0 with board president Bowie Hogg absent.
Before the district can officially vote on a tax increase, it must first publish information on the proposed budget and proposed tax rate, and call a public hearing. The information will be published in the Star-Telegram and on the district’s website at aisd.net.
A public hearing will be at 7 p.m. June 26 at the administration building at 1203 W. Pioneer Parkway.
In the May 10 bond election, voters authorized the district to issue debt. It’s much like going to the bank and getting a loan, said Cindy Powell, the district’s chief financial officer.
The tax increase is for the debt service portion of the district’s tax rate; the maintenance and operations tax, which pays for operating expenses, will stay the same.
The debt service tax rate is increasing not only to pay principal and interest on the first sale of bonds, but also to make up for a reduction in state funding that occurs when property values increase, Powell said.
Districts set the tax rate once a year to be adopted in August, and at this point Arlington is estimating what the rate will be for 2015-2016, Powell said.
Trustees will adopt the 2014-2015 budget by the end of June. The tax increase will go into effect in August after the school district receives certified property values from the Tarrant Appraisal District.
“The initial tax rate impact we projected was that rates at their peak would be 14 cents higher,” Powell said of the maximum tax impact from the bond election. “It looks like the peak may be 13 cents. We were very conservative on purpose about property value growth.”
The highest tax hit would occur from 2016 to 2020.