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Excess Revenue Election
Graydon Hicks
Friday, February 28, 2020

House Bill 3, referred to as HB3, made some dramatic changes to public school finance after the last legislative session.  Fort Davis ISD had been considered a “rich” district by the Texas Education Agency for several years, and HB3 did not change that.  HB3 did, however, create a new election requirement for FDISD.  The State (through TEA) gives annual funds to each school district, and FDISD had been having a certain amount of that funding withheld each year, to satisfy the “rich district” rules of giving money back to TEA.  HB3 now requires that FDISD hold an “Excess Local Revenue” election to allow our voters the opportunity to authorize our payment back to TEA.  That means that the district must now get voter approval to continue doing what TEA had been requiring us to do for years.   If FDISD does not get that voter approval, it does not mean FDISD gets to keep those “excess” funds, however.

If the election fails, then certain commercial (or industrial) property will be removed, or “detached” from FDISD tax rolls and annexed to another district elsewhere in the state, reducing our local tax revenue collections.  This would drop FDISD out of the “rich” district designation, but would mean losing, permanently, the value of certain real property (whose owners would be paying taxes to support a different school district, somewhere else in the state).   The process of detachment would begin again the following year, and the next, and so on....until an election passes.  

If the election passes, then FDISD will be able to send the required annual recapture payments back to TEA, without losing any local property assignments and values (which is essentially what FDISD has been doing for years). The calculations and terminology for our annual funds and repayments is complicated, but that is the basic impact of the election. 

This special election will be held on Saturday, May 2, with early voting beginning Monday, April 20 and ending on Tuesday, April 28.  If the election fails then the state will detach from FDISD some as yet unidentified property for the 2020 tax year and, likely, every year thereafter.  The owners of this property will be paying county taxes to Jeff Davis County, but they will pay their school taxes to some other district in the state….even if it was located in East Texas.  FDISD would have no control over that decision.   If the election is successful (passes) then FDISD will simply continue as we have in the past, never needing another election (unless the legislature changes the law, again).

The “excess funds” payments FDISD sends to TEA are called “purchases of attendance credits.” The language on the ballot will be:  AUTHORIZING THE BOARD OF TRUSTEES OF FORT DAVIS INDEPENDENT SCHOOL DISTRICT TO PURCHASE ATTENDANCE CREDITS FROM THE STATE WITH LOCAL TAX REVENUES. 

It is important that our community members and taxpayers realize that school districts have no control over a “rich” designation by the state.  FDISD cannot change our requirement for recapture payments simply by changing our tax rates.  The financial calculations and effects are complicated, and subject to the whims of the legislature during each session.  FDISD will continue to manage our taxpayer funds in the most responsible and efficient manner possible, regardless of the election outcome; however, if the election fails, the financial strain on the district will be considerable, and certain property/business owners will lose their tax payments to another school district.  Those school taxes will no longer benefit FDISD. Please call the FDISD Superintendent’s office if you need more information.