1. Town Hall on Budget & Taxes
March 26, 2019
Turner High School Auditorium

2. Topics of Discussion How Pearland ISD develops the annual budget
Where the District’s revenues come from, including:
Impact of property values and tax rate
Current State funding elements
Impact of enrollment and attendance on funding
How a citizen’s property tax bill is calculated
How the District spends its funds
Legislative Process Overview
PEARLAND INDEPENDENT SCHOOL DISTRICT

3. Budget Process Overview
Planning
What do we want to accomplish?
How are we going to accomplish it?
Preparation
Allocate resources to support the goals and objectives established during the Planning phase
Board approval and adoption
Evaluation
Assess performance of each campus, department, and district as a whole
Were goals and objectives met?
Fundamental part of planning for the next year
The District’s budget preparation is part of a continuous cycle of planning and evaluation to achieve the District’s goals.
PEARLAND INDEPENDENT SCHOOL DISTRICT

4. Budget Timeline Nov-Dec Enrollment Projections & Campus Allocations
Jan
District Budget Kick-Off Meeting
Feb-Mar
Budget Meetings with Campuses & Departments
Mar
Budget and Request for Additional Funds Due
Budget Review Meetings with Assistant Superintendents
Compilation of District-Wide Capital Improvement Plan
Mar-May
Board Budget Workshops
Jun
Public Hearing to Discuss Budget and Tax Rate
Budget Adoption
Aug
Tax Rate Adoption
PEARLAND INDEPENDENT SCHOOL DISTRICT

5. General Operating Fund Revenues
PEARLAND INDEPENDENT SCHOOL DISTRICT

6. Information Required to Prepare Revenue Assumptions
School Finance Law/Legislative Outcome
Enrollment Projections
Student Demographics
Attendance Rates
Taxable Property Values
Tax Rate
Tax Collections
Other Relevant Factors
PEARLAND INDEPENDENT SCHOOL DISTRICT

7. Projected
PEARLAND INDEPENDENT SCHOOL DISTRICT

8. PEARLAND INDEPENDENT SCHOOL DISTRICT

9. Average Daily Attendance (ADA) & Weighted Average Daily Attendance (WADA) Last 10 Fiscal Years
* FY is based on projections; the spike on WADA during and was caused by an increase on ADA reported for Free & Reduced student counts due to full enrollment coded during September and October 2017 due to Harvey.
PEARLAND INDEPENDENT SCHOOL DISTRICT

10. *18-19 Actual as of February 2019
*19-20 Estimates have not been prepared by the County
PEARLAND INDEPENDENT SCHOOL DISTRICT

11. Breakdown of Local Property Taxes
Over 46% of the District’s revenue comes from its local citizens through property taxes
The tax rate is comprised of two parts – Maintenance and Operations (M&O) and Interest and Sinking (I&S)
M&O
General Fund
Funds Day to Day Operations
I&S
Debt Service Fund
Can Only be Used to Pay Debt
PEARLAND INDEPENDENT SCHOOL DISTRICT

12. Tax Rate (Per $100 Valuation)
Tax Year
Fiscal Year
M&O
I&S
Total
2017
$1.04
$0.3756
$1.4156
2018
$1.06
$0.3556
2019
$0.3906
$1.4306
PEARLAND INDEPENDENT SCHOOL DISTRICT

13. *Includes Current Year, Prior Year, Delinquent, and Penalty and Interest.
PEARLAND INDEPENDENT SCHOOL DISTRICT

14. General Operating Fund Revenue Projection $166 Million based on Current Funding Formulas
Revenue (in millions)
FY Amended
FY Projected
Variance
Local Property Taxes
$80.9
$80.2
-$0.7
Other Local
1.8
0.0
State
82.2
73.6
-8.6
TRS On-Behalf
8.3
Federal
2.1
Total
$175.3
$166.0
-$9.3
Fiscal Year projections are based on an M&O tax rate decrease from $1.06 to $1.04, which reduces local property tax revenue albeit an increase in property values and also decreases State funding. State funding also decreases due to a slight decrease in enrollment and a loss of State Compensatory Education (SCE) counts generated during Hurricane Harvey when all students were coded as “Free & Reduced”.
PEARLAND INDEPENDENT SCHOOL DISTRICT

15. Local vs. State Share of Basic Allotment
PEARLAND INDEPENDENT SCHOOL DISTRICT

16. General Operating Fund Expenditures
PEARLAND INDEPENDENT SCHOOL DISTRICT

17. Information Required to Prepare Expenditure Assumptions
Revenue Levels
Legislative Mandates
District Initiatives
Prioritized Needs
Staffing Formulas & Needs
Salary Increases
Benefit Contributions
Other Relevant Factors
PEARLAND INDEPENDENT SCHOOL DISTRICT

18. How Much Money is Distributed to Each Campus?
Student Enrollment & Staffing
The number of students projected to enroll in the fall determines the number of teachers and support staff that each school receives.
That is, enrollment translates into staff positions, which translates into salaries and benefits.
School Operating Budgets – The money each campus receives for supplies, equipment, and other operating expenses are allocated on a per-pupil basis. Staffing is not paid from campus budget allocations.
Elementary & Middle
$89.10
Junior High
$100.14
PACE
$113.94
High School
$128.70
PEARLAND INDEPENDENT SCHOOL DISTRICT

19. Budget Breakdown by Object Fiscal Year 2018-2019 $176.9 Million
PEARLAND INDEPENDENT SCHOOL DISTRICT

20. How is the General Operating Fund Allocated? Fiscal Year 2018-2019 $176.9 Million
PEARLAND INDEPENDENT SCHOOL DISTRICT

21. District & State-Wide Comparison of Budgeted Operating Expenditures Fiscal Year 2018-2019
Source of State Percentages: TEA Budgeted Financial Data
PEARLAND INDEPENDENT SCHOOL DISTRICT

22. General Operating Fund Summary & Estimated Days in Fund Balance Fiscal Year Projections (in Millions)
Fiscal Year revenue projections are based on current funding law; projected expenditures are held at current fiscal year levels, with no salary increases and without restoring prior year budget cuts.
The $10.9 million deficit is due in large part to reverting the M&O tax rate from $1.06 to $1.04, a slight decrease in enrollment coupled with a conservative growth in property values, and a loss of the additional revenue generated through the SCE counts during Hurricane Harvey.
PEARLAND INDEPENDENT SCHOOL DISTRICT

23. Effect of an Increase to the M&O Tax Rate Fiscal Year 2019-2020 (Estimated)
Additional Funding (in Millions)
Annual Taxpayer Impact
Tax Rate
Rate Increase
State
Local
Total
$1.05
+ 1 cent
$1.96
$0.78
$2.74
$23.81
$1.06
+ 2 cents
$3.92
$1.56
$5.48
$47.62
$1.07
+ 3 cents
$3.99
$2.34
$6.33
$71.43
$1.13
+ 9 cents
$4.43
$7.02
$11.46
$214.28
$1.17
+ 13 cents
$4.71
$10.15
$14.86
$309.51
Notes:
Each cent raised in taxes generates $780,000 in local funds and $1.96 million in State funds (up to $3.92 million in State funds, for a maximum of two additional cents).
Each cent increase beyond an M&O rate of $1.06 generates an additional $72,000 in State funding.
The annual cost of each cent beyond $1.04 for a taxpayer with an average appraised home value of $263,087 is $23.81.
PEARLAND INDEPENDENT SCHOOL DISTRICT

24. Surrounding Area School District Tax Rates for Fiscal Year 2018-2019
M&O
Tax Rate
I&S
Total
GALENA PARK ISD
1.2433
0.3300
1.5733
DEER PARK ISD
1.2367
0.3020
1.5387
PASADENA ISD
1.2000
0.2800
1.4800
ALVIN ISD
1.1700
1.4500
PEARLAND ISD
1.0600
0.3556
1.4156
CLEAR CREEK ISD
0.3400
1.4000
FRIENDSWOOD ISD
0.1970
1.3670
PEARLAND INDEPENDENT SCHOOL DISTRICT

25. Debt Service Fund
The Debt Service Fund is used to pay the principal and interest on bonds that we issue to finance construction, renovations, and other capital improvements.
PEARLAND INDEPENDENT SCHOOL DISTRICT

26. Debt Service Requirements
PEARLAND INDEPENDENT SCHOOL DISTRICT

27. Debt Service Fund Tax Rate to Meet Debt Service Requirements
Tax Year
Fiscal Year
Tax Rate Increase/ (Decrease) in cents
Updated Projection
2017
$0.3756
2018
(2.00 cents)
$0.3556
2019
3.50 cents
$0.3906
2020
2.00 cents
$0.4106
2021
2.55 cents
$0.4361
2032
(23.50 cents)
$0.2011
2042
(19.28 cents)
$0.0083
PEARLAND INDEPENDENT SCHOOL DISTRICT

28. Calculation of Property Tax Bill
PEARLAND INDEPENDENT SCHOOL DISTRICT

29. How is Your Property Tax Bill Calculated
How is Your Property Tax Bill Calculated? Based on Tax Year 2018 Average Market Value of Residences
Average Market Value of Residences
$263,087
Less: Homestead Exemption
(25,000)
Total Taxable Value
$238,087 ÷
Taxable Value (per $100 of assessed valuation)
$2,380.87
× Tax Rate
× $1.4156
Total Property Taxes Due
$3,370.36
The taxes you pay on your home are part of the local revenues that make up ___% of Pearland ISD’s revenue budget. For , the BOT adopted a tax rate of $ per $1000 of assessed valuation.
M&O
$2,523.72
I&S
$846.64
Pearland ISD grants the state-required $25,000 homestead exemption for all homeowners that apply to the appraisal district for that exemption. Homeowners who are disabled or age 65 or older are entitled by state law to an additional $10,000 exemption.
PEARLAND INDEPENDENT SCHOOL DISTRICT

30. Thank You! Pearland ISD Business Office
Follow us on
PEARLAND INDEPENDENT SCHOOL DISTRICT