MISD Calls for School Funding Referendum to Access Golden Pennies

Funding would address four budget priorities: teacher and staff compensation, lower class sizes, student programming and experiences, and safety and security enhancements.

The Midlothian ISD Board of Trustees approved placing a School Funding Referendum or Voter-Approval Tax Rate Election (VATRE) on the November 5 ballot. The referendum asks voters to consider accessing three Golden Pennies.

The Golden Pennies would generate an estimated $4.7 million in additional state and local funding taxes to the general operating budget. This additional funding would move the district closer to a balanced budget while addressing key funding priorities - teacher and staff compensation, maintaining lower class sizes, student programming and experiences, and safety and security.

Over the past nine years, MISD has demonstrated strong financial stewardship by strategically refunding (refinancing) and paying off debt early. These efforts have saved taxpayers more than $100 million in interest and allowed the district to lower the Interest and Sinking (I&S) tax rate by $0.03. This reduction fully offsets the proposed addition of $0.03 to the Maintenance and Operations (M&O) rate, which means the overall tax rate will remain unchanged for our taxpayers.

Trustees say accessing the three Golden Pennies is a decision for the community. “We’ve put forth what we consider to be the most fiscally responsible approach to access and maximize local and state funding,” said Board President Gary Vineyard. “Our stewardship in paying down bond debt presented an opportunity to lower the I&S rate, which means taxpayers will see no change in the overall school district tax rate."

What will happen to the tax rate?

• With voter approval, this referendum will keep the overall MISD tax rate slightly below last year’s total rate. The adopted 2024-25 overall tax rate is $1.1069 compared to the 2023 rate of $1.1092 and includes the additional three Golden Pennies that the district is asking voters to consider.
• Additionally, the overall average tax bill is estimated to be $328 less compared to what the average resident would pay based on last year’s ISD tax rate and taxable value.
• When trustees adopted the 2024-25 tax rate, it included a $0.03 reduction in the Interest and Sinking (I&S) fund tax rate. The reduction offsets the addition of three Golden Pennies to the Maintenance and Operation (M&O) tax rate.
• Property owners 65 and older with a homestead tax ceiling would experience no change to their taxes as a result of the election.

What is MISD’s fiduciary track record?

• Midlothian ISD has been a careful steward of taxpayer dollars. The district’s most recent external audits, with unmodified opinions, have been the highest-rated.
• For the past 22 years, the district has received the highest financial integrity rating, Superior (A), from the state of Texas.
• Since 2017, the district has held Transparency Stars for Traditional Finances and Debt Obligations from the State Comptroller. It has been awarded the prestigious Award of Excellence in Financial Management and the Award of Merit for Purchasing Operations from the Texas Association of School Business Officials (TASBO).

What caused the district’s budget shortfall?

• Many Texas school districts have adopted deficit budgets for the current year. MISD’s budget shortfall is $5.7 million. Contributing factors include rising inflation costs, increased costs in safety and security measures (which MISD remains committed to implementing), and the *basic allotment of $6,160 per student remaining unchanged since 2019.
• MISD remains committed to investing in teachers and staff. The 2024-25 budget includes a 3% general pay increase for teachers and librarians and an average 1% increase for all other positions. The district also estimated operational expenditures like fuel, electricity, insurance, safety and security, and growth in Special Education would increase in the 2024-25 fiscal year, costing the district an additional $1.7 million compared to last year's expenditures.

*The Texas basic allotment is a foundational component of the state's school finance system, representing the minimum amount of funding allocated per student. It serves as the starting point for calculating state funding to school districts, with adjustments made based on factors such as district size, demographics, and special programs.

Visit the district's School Referendum information page here.