School board members also voted to adopt a budget for the coming school year that includes the 3 percent pay increase.
Budget planners expect the school district to receive about $29 million over the next 12 months, some $22 million of that in state funding and about $5.8 million in tax revenue.
BISD will spend the same amount it receives in revenue to maintain and operate schools as well as pay off long term debt, such as bonds. The school district will have about $7.3 million in its reserve fund.
To help finance the spending plan, which goes into effect Oct. 1, trustees voted to adopt a proposed tax rate of $1.35109 — $1.10 of which is earmarked for maintaining and operating schools and .25109 cents allocated for debt payments.
The school district charged taxpayers $1.18167 last year for every $100 worth of property they owned. Of that amount, $1.04 was spent on maintaining and operating schools and .14167 cents was spent on paying off debt.
Because of a sizeable increase in property values within the school district since last October, BISD can lower its tax rate this year to $1.29276 and still generate the same amount of tax revenue as it did last year. That’s called the effective tax rate.
However, to pay for the 3 percent salary increase for employees, trustees agreed formally Tuesday to adopt a proposed tax rate this year that is 6 cents above the effective tax rate.
Each penny of tax rate generates about $150,000 for the school district; thus, the 6 cent increase will generate about $900,000 — which will cover the $660,000 in salary increases and about $224,000 in benefits. Voters have to approve any tax rate increase proposed by school districts.
The tax rate election will be held during the Nov. 4 general election. If the tax rate request is approved by voters, the pay raises will be provided to employees retroactive to the beginning of the school year.
If voters do not approve the tax rate request, trustees will have to cut more than $900,000 from the budget or dip into the district’s reserve fund.