Wednesday, April 17, 2024

Bond or bust -- Part 3

‘No’ voters stand against property tax increases


Editor’s note: This article is part three of a series to find out why Springtown Independent School District’s bond proposals have failed four times in a row. The Tri-County Reporter has interviewed supporters and opponents of the school bond and SISD’s leaders as well as retrieved data on local property taxes. Part one delved into the history of SISD’s bond efforts, and part two discussed overcrowding at campuses. Part three of this series considers the main objection to the bond — property tax increase. 

SPRINGTOWN — Springtown resident Alex Rivera feels conflicted about Springtown Independent School District’s previous bond proposal.

After he and his wife retired, the Riveras decided to sell their home in California to move to Texas where one of their daughters had previously settled. They lived in the Houston area for about a year and eventually moved to a home in Springtown last spring. By fall 2023, Alex Rivera took a job working in the cafeteria at the intermediate school.

Rivera didn’t move to Texas without concerns, the main one being expensive property taxes. His daughters — both the one who lives in Texas and is looking for a home to buy and the one who lives in California and wants to move to Texas — share that unease.

“For me, it weighs heavily,” Rivera said. “I own my home, so I don't have a mortgage. But to know that I'm going to be paying whatever it is, $6,000, $7,000, $8,000, a year for the rest of my life and more depending on the initiatives that may get passed, it's a bit daunting.”

Fear of more expensive property tax bills is what compelled Rivera to vote against SISD’s bond proposal in November 2023, the latest of four failed bond elections meant to add a new campus and accommodate rising enrollment.

Rivera said his 2023 tax bill was about $6,500, thousands more than what he paid for property taxes in California. For him, paying the bill isn’t the issue, though he does know people who are concerned about being priced out of their homes; it’s the principle of it.

“Something doesn't seem right about paying that much money for property tax when we don't get any benefit from it either,” Rivera said. “We don't have any kids in the (school) system, so is there no consideration for that?”

Yet, Rivera doesn’t want to sound selfish. He has listened to and sympathized with bond supporters.

“They apparently don't mind the raising of taxes because it's going to the schools, and I understand that, and their children are still in school, so they want the best for their kids, and I totally understand that,” he said. “If I was in that situation, I would feel the same way. But I'm not.”

Rivera even said he thinks SISD’s bond proposal is necessary to accommodate growth. As far as he can tell from working in the intermediate school’s cafeteria, there are multiple lunch periods that seem well-managed and not exactly overcrowded. However, he said more space will be needed if enrollment continues to increase as projected. Still, he can’t bring himself to support a property tax increase for a project that doesn’t directly benefit him or his family.

“I want to be part of the community,” Rivera said. “I want to help the community. I want to help the school district, but I'm just conflicted.”

The November 2023 bond election, if passed, was projected to increase the tax rate that SISD’s board set in August, which was lowered by about 18 cents. However, the new tax rate brought on by a successful election would have been about a cent less than the previous year’s rate.

Jessica Castro, who graduated from Springtown schools and has had children who were educated in SISD, isn’t buying that higher property taxes are a legitimate reason for not supporting the school district’s bond proposal. 

“Are we really putting a price on our children's education and the comfort level that they have at school?” Castro said.

Rivera is not alone in his reasoning. After SISD’s bond election failed in November, multiple people posted on Facebook about their opposition to bond, and many of them cited high property taxes in their logic.

“People are worried about losing their homes,” SISD Superintendent Shane Strickland said. “They're worried about losing their small businesses. We've heard from some of those community members, and if they're having to make a choice of whether it's going to impact them and their family, they're not going to vote ‘yes,’ and that's just kind of the state of the economy right now. We're not mad at those people for it, but we still have our issues that we're dealing with and the way that school finance is built right now, this is our only way of being able to build a new building.”

One of the people who posted on Facebook after the November bond election failed was Andrew Kloster, who has lived outside Springtown in unincorporated Parker County since March 2022 and pays taxes to the school district. On Facebook, Kloster wrote, “It’s time for this school board to be fiscally responsible.” He said his comment was inspired by his property taxes doubling.

“We cannot continuously increase property taxes,” Kloster said. “It becomes too expensive for people if it goes up every single year. Plus, the school district gets the largest sum of the tax revenue. These government employees always want to spend, spend, spend and raise taxes. They don't care about the repercussions. I'm still working, and it's still hard on me. What about people that are on fixed incomes and can’t afford $200-$300 a month in increased taxes? It's just too much.”

School Board President Rick Beall said he shares the frustrations of other property owners in town and pointed out that lowering the tax rate has been a priority for the board. 

“I'm also a taxpayer, and I understand,” Beall said. “That's always forefront in every one of these trustees’ minds that we want to make sure we're doing what's best for our stakeholders. Unfortunately, these things cost money. I wish there was a better way to do it, that we didn't have to do it this way. But it is the hand that we're dealt, and it's the only way we can go forward.” 

While the price of property taxes in Springtown may differ from other parts of the country, Samco Capital senior managing director Douglas Whitt said SISD’s taxes are not generally higher than other growing North Texas suburbs.

“(SISD’s) facility needs are well demonstrated,” said Whitt, who has served as a financial adviser to the district. “Their bond plan to address those needs is necessary by state law and by how schools are funded in Texas and well within the scope of bond programs in Texas.”

That said, property taxes in the Springtown area are not cheap.

Bills, bills, bills

According to the Parker County Appraisal District, the average market value of a home in the SISD area, which extends far past the city of Springtown’s boundaries, is $340,479 before exemptions and caps. When this figure is plugged into the appraisal district’s property tax calculator for Springtown, it yields a 2023 tax bill of $5,875.15 with the homestead exemption and a bill of $6,834.63 without exemptions. Keep in mind that Texas voters approved increasing the homestead exemption from $40,000 to $100,000 in November, and this change applied to 2023 tax bills.

People who live in SISD’s territory don’t just pay taxes to the school district but also to the city, county, emergency services and hospital districts and Weatherford College, depending on where they live. But the lion’s share of the money paid goes to SISD, which receives $2,303.31 from an exempted property with a market value of $340,479 and $3,261.11 on the same property without exemptions, according to the appraisal district’s tax calculator.

The average market value of a home in SISD increased between 2022 and 2023 from $236,937 to $340,479. Rising property values can be caused by economic growth, population increase, job opportunities and demand for real estate, Parker County Appraisal District Deputy Chief Appraiser Troy Hanson said.

“Additionally, low interest rates and a limited housing supply can contribute to increased demand, putting upward pressure on prices,” Hanson said. “We study these various factors and trends and adjust our appraisals according.”  

Hanson pointed out that the appraisal district reappraises properties every other year to coincide with the School District Property Value Study, a state audit that “ensur(es) that property values are at or near 100% market value for equitable distribution of state funding for public education.”

Though school boards don’t appraise homes, they do set the district’s tax rate. In the past 10 years, SISD’s tax rate has either stayed the same or decreased. This includes a significant decrease last year when the school board lowered the rate from about $1.43 per $100 valuation to about $0.96 per $100 valuation because of tax rate compression enacted by the Texas Legislature. In comparison to other Parker County area school districts, SISD’s tax rate is below the median in 2021, 2022 and 2023 with Brock ISD and Aledo ISD having the highest rates and Garner ISD with the lowest.

Strickland hoped the increased homestead exemption and the fact that the district’s tax rate would have been a penny less than the 2022 rate if the bond had passed would sway voters’ opinions, but it didn’t.

SISD’s bond election failures may occur because of poor timing. School districts in Texas can either have bond elections in May or November, both of which are preceded by important property tax dates. In April, property owners receive their appraisal notices, and in October, they receive their tax bills.

A local bond election that did pass in November was Parker County’s multi-million-dollar proposal to improve transportation in all precincts. Strickland suspects voters approved it because by driving around the county, they can see that roads need to be fixed. In contrast, not all voters see the overcrowding in schools and therefore, are less likely to approve that bond proposal.

Put differently, Weatherford College Social Sciences Department Chairperson Jared Stewart said bond elections are won when “they are framed in a favorable way to the public that gets to vote on them.”

“For example, if you can convince residents that a few extra pennies will reduce potholes, that is an investment they will see pay off every day they drive,” Stewart said. “If they are being asked to provide more funds for an education program about which they have concerns, it will be a tougher sell. If you can convince residents that the issue is salient, the costs will be relatively low, and the payoff will be meaningful and quick, you will most likely be successful in getting your measure passed.”

Kloster is skeptical of how SISD is using its tax revenue and planning its finances. He said he thinks SISD should pay off its previous debts before taking on more, but he’s also concerned about a successful bond election having a snowball effect where the district continues to take on more debt and raise taxes.

“I think there just needs to be a little bit more fiscal control over the bonds because it's never going to stop,” he said. “Every couple of years, they're going to come back and say they need something else, or they need more.” 

Despite people saying that SISD should consider other revenue sources or use the money it already has in its budget, Strickland said the only realistic way for the district to meet its needs is to pass a bond election. In August, the school board adopted a balanced budget of just over $53 million, which is dedicated to running the schools and paying off debts. The superintendent said the district’s maintenance and operations (M&O) budget — which covers expenses like salaries, utilities and supplies — can be used for small construction projects but not much more.

“We're able to do some renovations and things like that,” Strickland said. “But as far as building a building, we just don't have the money in our M&O side for those things.”

SISD’s bond proposals in 2023 called for the district to fund a new middle school and renovation projects for $120.78 million. Former assistant superintendent Mike Gilley said that number will only increase the longer construction is delayed.

“This is something that needs to happen because we're not going to get smaller,” Gilley said. “Materials, construction is just going to increase per square foot on any building that we look at putting in.”

Gilley said he has heard people say they don’t support the school bond because they don’t have kids in school, and he has a message for them.

“Some of the kids I went to school with, my friends, they say, ‘Why should I pay for it when I don't have any kids going?’ Of course, my answer back was, ‘Who do you think probably paid for us when they didn't have any kids going? It’s the people that live here and want to call this their home and their community and something to be proud of,’” he said.

Increased property taxes weren’t the only reason why people opposed the bond. Another justification surfaced as well — rejection of the proposed middle school’s sports facilities.

Stay tuned for the next part of “Bond or bust” in next week's paper.