GISD board unanimously adopts tax rate, FY 2026 budget

Gonzales ISD board members voted unanimously Monday, Aug. 25, to adopt a tax rate of 87.5 cents per $100 valuation for the 2025 tax year and to adopt a fiscal 2026 budget that calls for aggregate expenditures of $43,325,826.

District Chief Financial Officer Amanda Smith said the tax rate includes a maintenance and operations tax rate that is the same 73.08 cents as last year, but the debt service tax rate includes a 1.16 cent increase from 13.26 cents to 14.42 cents.

“What is causing the tax rate to go up slightly into 2025 is the I&S or debt service portion of our tax rate,” Smith told the board. “That portion of our tax rate is necessary to support the voter-authorized debt that the district has due to the majority of our community voting yes in the 2023 bond election.

“That increase in the I&S tax rate is necessary due to the additional homestead exemptions that were passed during this year's Texas Legislative session. Those additional homestead exemptions are causing our taxable property values to decrease.”

Smith said that despite the increase in the tax rate, local residents “will still experience a decrease in their GISD property tax bill — again due to those additional homestead exemptions.”

“Where we will bring in additional tax revenue is from the other categories of property that we have in minerals, which make up almost 50 percent of our tax base,” Smith added.

She said the district has seen its tax rate drop by 30.5 cents in the past seven years from a rate of $1.18 in 2018. 

In November 2023, district voters approved Proposition A calling for issuance of $50.6 million in bonds to pay for renovations and upgrades at all five school campuses, the administration building, maintenance and transportation and the construction of the new Tom Lester Jr. CTE building and Ag Barn (which is currently under way).

Originally, the district had forecast the need to raise the debt rate by 8.13 cents to cover the cost of the bond, but due to tax compression by the state and an increase in the homestead exemption as well as interest earned by the district and savings achieved, the debt service tax rate has only had to increase by 5.03 cents — a difference of 3.1 pennies.

Smith presented a slide that shows Gonzales ISD’s tax rate from 2024 was one of the lowest among district in Gonzales and neighboring counties. Of 13 school districts listed, GISD was the third-lowest in 2024 at 86.34 cents, behind just Karnes City ISD (79.6 cents) and LaGrange ISD (81.53 cents). Navarro ISD is the highest at $1.1827 per $100 valuation.

“We are still at the very low end of tax rates when you compare Gonzales ISD to other districts in Gonzales county as well as the surrounding county,” Smith said. “On top of that, several of the districts around us, I've spoken with them, and they are either calling a bond election or a voter approval tax rate election for this year. I applaud and appreciate your conscious effort to support our district's desire for a high quality educational system, while also operating on a conservative financial mindset.”

The district approved the budget in three separate motions — one to cover the general fund, one to cover the cafeteria/food service fund and one to cover the debt service fund. The total aggregate amount is $2,199,386, or nearly 5.35 percent more than the aggregate $41,126,440 approved in the fiscal 2025 budget.

On the revenue side, the budget will bring in a total of $40,848,061 —an increase of $4,050,505 or 11 percent more than the $36,797,556 the district brought in for the fiscal 2025 budget. When put together, the district will bring in $2,477,765 less in revenue than expenditures for the fiscal 2026 year after bringing in $4,328,884 less in revenue when compared to expenditures in fiscal 2025.

The fiscal 2026 general fund budget will see expenditures of $36,667,099 compared to revenue of $34,189,834 with an additional $500 transferred out to the food service fund. The food service budget calls for revenues of $2,256,052 compared to expenditures of $2,256,552 plus the $500 transfer in from the general fund. The debt service fund is balanced and calls for equal revenues and expenditures of $4,402,175.

School districts continue to shoulder a larger burden of the cost for educating students and in Gonzales ISD, local property taxes and other local revenues make up nearly 68.3 percent or $27,898,376 of the total revenues being raised in the new fiscal year. State revenues account for 25.53 percent of revenue, or $10,427,718, while federal sources account for the remaining 6.17 percent, or $2,521,967.

Of the total general fund expenditures of $36,636,107 budgeted for fiscal 2026, 72 percent is for salaries and benefits while the remaining 28 percent is budgeted for contracted services, supplies and materials, capital outlay, debt service, and other operating costs.