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Willis ISD projects roughly $90M no‑new‑tax bond capacity, outlines new state tax‑rate steps
Summary
District finance staff told trustees preliminary taxable values rose ~7% and projected a no‑new‑tax‑rate bond capacity near $90 million; staff also described a planned refunding of 2016/2017 bonds (authorization under $58M) and explained new state worksheet requirements to set a minimum debt‑service tax rate for 2026.
Willis ISD finance staff briefed trustees July 8 on preliminary property valuations, tax‑rate modeling, and options to reduce interest costs through refunding and defeasance.
Staff said taxable values are trending at roughly 7% growth in preliminary figures, down slightly from earlier projections. Using those preliminary values and the district’s current rate structure, staff modeled a compressed maintenance & operations (M&O) rate and a total projected tax rate just above $1.00 if current assumptions hold. The finance presentation used a $350,000 average home example (homestead exemption $140,000 → taxable value $210,000) to show school‑district tax impacts.
On capacity, staff ran a projection showing the district could finance up to about $90,000,000 in new bonds without increasing the district’s tax rate under current assumptions. The model assumes continued value growth and will be updated once certified values are received; staff said certified values are expected in late July and final projections will follow.
Staff outlined two debt‑management actions on the agenda: a bond refunding (refinancing select 2016 and 2017 issues) with maximum authorization reported just under $58,000,000 and a required net‑present‑value savings threshold of 3%; and a bond defeasance (early payoff) that would reduce future interest expense. The presenters characterized refunding as a refinancing step, not new debt issuance.
Trustees and staff discussed the state’s new tax‑rate process (referred to in the presentation as S P 14 53), which requires calculation and board approval of a minimum debt‑service tax rate that would secure required debt payments. Staff projected that minimum rate at just over 30¢ under preliminary values. The new procedure will require trustees to approve the “minimum rate” and a proposed higher I&S (interest & sinking) rate in separate votes next month, with specified motion language describing the difference and the purpose of any excess revenue.
Staff noted the final compressed M&O and I&S rates will be set after certified values are submitted to TEA and the county. The board asked for follow‑up models and said it expected administration to return with updated savings projections for the refunding once market interest‑rate data were firm.
What’s next: certified property values and final refunding savings estimates will be completed in late July/early fall; the board will consider separate votes to adopt tax‑rate elements and finalize budget amendments at the August meetings.
