The previous tax rate was $1.60 per $100 valuation; the new proposed rate is $1.55.
The board will approve the new budget at its special meeting Aug. 29.
The rate is broken down into two parts: a maintenance and operation tax of $1.10 and $.45 for debt reduction.
The reduction is thanks to two reasons: low bond interest rates and the elimination of an optional homestead exemption.
“When the district sold bonds for the new elementary school, it received a very low interest rate because of the district’s strong financial rating and fund balance,” explains district Business Manager Carole Estes.
That allowed for lower payments this coming year, she says.
In addition, last June the board eliminated an optional homestead exemption.
“It’s important that taxpayers understand we’re not talking about the state’s homestead exemption,” Estes stresses. “This is a separate additional exemption that has been in place since the 1980s.”
That additional optional exemption, Estes says, allowed eligible homestead taxpayers to claim an additional $5,000, or 20 percent (whichever was higher) which acted as a “financial penalty against the district” because it required the district to pay $90,000 last year to the state.
While the elimination of the additional optional exemption represents a homestead value increase for a little more than 400 homesteaders who claimed it, that $90,000 savings has resulted in a higher overall property value for the district, which meant a debt service tax rate reduction by five cents.
Estes also praised the work of County Tax Assessor Linda Bridge for her “stellar job” of collecting STISD taxes.