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McAllen ISD advisers say $335 million bond could be sold without raising tax rate
Summary
Financial advisers told McAllen ISD's facilities advisory committee that roughly $335 million in bond funding could cover priority campus projects without increasing the district tax rate, but warned the ballot language will still appear as a 'tax increase' and voter education will be essential.
Miss Lorena Garcia, deputy superintendent, opened the Facilities Forecast Advisory Committee meeting and turned finance questions to the district's outside financial adviser.
"We've calculated that $335,000,000 can address the projects mentioned by Lorena, with no tax rate increase," said Bobby Villarreal, who identified himself as with Strad and Hossa, describing a plan to sell the bonds in multiple tranches to limit tax-rate impact and stage construction over several years.
The advisers explained the mechanics behind that assertion: paying down existing debt, shifts between maintenance-and-operations (M&O) and interest-and-sinking (I&S) revenue, and rising taxable values can create borrowing capacity. Villarreal noted the district's overall tax rate has fallen from about 1.15 a decade ago to about 0.93 today, and staff estimated a roughly 22-cent decline over the last 10 years.
Villarreal also described recent local homestead-exemption changes approved in November, saying the exemption for school taxes was increased from $100,000 to $140,000 and that a senior exemption was set at $200,000 with a tax levy freeze for homeowners 65 and older; he used those numbers to illustrate how taxable values and exemptions affect homeowners' bills.
Despite the advisers' projection that the bond program could be structured without a tax-rate increase, Dr. Robbie McGowan of Pflueger Architects warned the committee of a voter-education nuance: "the state... puts on the ballot that... this voting for this is a... tax increase even though it would not raise your tax rate," a point staff said will require careful, informational outreach that the district can legally perform (but not campaign).
Timing and process remain subject to the board's decisions. Advisers described a plan to sell the program in up to four tranches to reduce annual tax impacts and to begin selling bonds shortly after a successful May election. Committee materials and presentations set target steps: refined scope and cost estimates in January; a draft list to the board in late January; a potential final board action in early February to call a May referendum (a Feb. 13 deadline for placing a measure on the May 2026 ballot was cited in the meeting).
Committee members pressed for clearer sequencing and which projects would occur in which tranche; staff said some projects (LED lighting, HVAC upgrades) require less lead time and could start earlier, while larger modernization projects require more design time and staging. The committee will review refined scopes and cost estimates at an upcoming January meeting before recommendations go to the board.
No formal motion or board vote was taken at the advisory committee session; staff will prepare the refined project list and cost estimates for board consideration.
