1. KENNEDALE ISD
BUDGET WORKSHOP
July 23, 2019

2. Overview
The Texas Legislature passed HB3 which is a significant change in the way that school districts are funded.
Also part of HB3 is tax compression.
The School Board is tasked with adopting budgets for Maintenance and Operations (General Fund), Child Nutrition Program (Food Service), and Interest and Sinking (Bonded Indebtedness)
Future slides will attempt to explain the changes and the effect on Kennedale ISD.

3. Property Taxes
Tarrant Appraisal District is tasked with preparing the Appraisal Roll for all taxing entities in Tarrant County.
Certified values according to the TAD will not be completed until July 26, 2019.
The certified property information for 2018 was a total of $1,455,530,385 on July 20, These amounts change daily and when the tax rate was adopted the value had risen to $1,467,774,017.
Preliminary values as of June 6, 2019 was $1,604,753,712.

4. Property Taxes (Continued)
The tax rate for school year was $1.17 per $100 valuation for Maintenance and Operations.
As part of HB3 the tax rate has been compressed to $ per $100 valuation for Maintenance and Operations.

5. State Funding
The basic allotment under old law as $5,140 under HB3 it is $6,160. With this major change not all components of state funding are determined currently. Each week the District receives clarification. Some items will not be clarified until settle up in August 2020.
With the increase in the basic allotment various components of state funding were eliminated, changed, or added.
Items eliminated were Cost of Education Index (CEI) old law had this multiplier at 1.09, Gifted and Talented Allotment, High School Allotment, Staff Allotment.

6. State Funding (Continued)
Items changed:
Mid Size Adjustment old law was an adjustment to the basic allotment under HB3 it is a stand alone item.
Compensatory Education Allotment old law it was an average of the best six month of free and reduced students under HB3 it is based on census tracks.
Transportation allotment was a computation based on linear density under HB3 it is $1.00 per mile driven.

7. State Funding (Continued)
Items changed (continued)
State Certified Property Values has changed from a lag of one year to start using current values.
Values are determined by the comptroller of public accounts. Preliminary values come out on January 31st, final values are not certified until July 31st.
Values for 2017 were used in computing local fund assignment for the budget year ($1,269,974,995). Under old law the value for would have been ($1,420,300,341). Instead values will be based on current year values (estimated to be $1,604,753,712).

8. State Funding (Continued)
Items added was a School Safety Allotment.
Salary increases are a factor of total gain in state funding using HB3 amounts. For Kennedale ISD the best estimate of total gain is $1,422, % of this gain should be used for increases in salaries which currently determined amount to be $426,772. Of the Total Gain 75% ($320,079) goes to teachers, librarians, nurses and counselors. The other 25% ($106,693) goes to all others. In relation to the teachers, librarians, nurses and counselors there must be a differentiation for those with five years are less of experience and those with more than five years.
We will discuss a compensation plan to implement this salary increase.

9. Child Nutrition Program
Working with Ms. Humiston a budget for the Child Nutrition Program has been prepared.
Revenues $1,600,477
Expenditures $1,600,477

10. Interest and Sinking
For the budget year we have the following payments to be made:
Principal $2,540,000
Interest 1,055,000
Fees ,000
$3,602,250
We can discuss setting the tax rate for payment of our bonds.