SISD cuts tax rate
Area residents can expect a more than 7 cents decrease
The Sherman Independent School District is reducing its property tax rate for the second year in a row. Members of the SISD Board of Trustees approved a $1.4697 property tax rate for each $100 of assessed value for the 2020-2021 fiscal year.
By comparison, the rate was $1.5473 for the previous fiscal year.
District officials attribute the drop to a combination of state-imposed rate compression and increasing development in Sherman.
"Our values are up about 10 percent primarily due to new growth in Sherman, just as they were the previous year,“ said Tyson Bennett, SISD assistant superintendent of finance and operations. ”It is really just due to us being in a high-growth area.“
Bennett said the tax rate came in slightly later this year due to delays in setting valuations on the county level due to the current pandemic. Traditionally the district would approve the rate in August, but finalized valuations came in late last month.
“Once they set the certified values, we have until Sept 30 to set out tax rate,” Bennett said. “We normally do that in August, but since we received those values at the end of August we couldn’t set our values.”
The district sets the rate following guidance from the Texas Education Agency, which sets a maximum compressed tax rate. Tax compression came as a result of tax reforms related to Texas House Bill 3 in the last legislative session.
Maximum compressed tax rate came from the TEA in August. Appraisal district certified estimate came in July, certified values came in August.
“It is really where the state would establish compression ratios and would simply do that — compress your tax rate over a two-year period,” Bennett said. “What that does is establishes where the tax rates are lowered and the state works to make up that funding that district loses through tax compression.”
SISD’s tax rate represents two different tax rates combined into one. The district is maintaining a debt service rate of $0.479 per $100 of assess value, which was set in 2018 by the successful package of Sherman’s bond election.
For the maintenance and operation rate, the board approved a decrease of 7.76 cents, reducing it to $0.9907 per $100 of valuation.
This marks the first time in more than 20 years that the district’s M&O rate has been below $1.
Despite the decrease, the district is poised to see a revenue increase in the upcoming year as revenues are projected to climb from $75.61 million in 2019-2020 to $77.53 in 2020-2021.