I love this job and appreciate the opportunity to serve the students, families, and taxpayers of Wylie ISD. A big reason for my feelings about this district are the amazing relationships we have built with you during my eight years of service. Your input is valued and appreciated. On behalf of the Wylie ISD Board of Trustees, I can say that we all believe and value the approach that “our school belongs to the people.” The public has entrusted us with your children and tax dollars.
The Wylie ISD Board Goal to“manage growth in a way that provides functional equity, financial responsibility, and assurance for all student needs” serves as a guide for our fiscal approach to all matters relating to Wylie ISD. Again, these are your schools and we do our best to gather information and listen to the public. We have had requests from parents and community to add facilities like an aquatics center and amenities like other surrounding larger districts. These items have not been added to the Master Facilities Plan because it would compromise our goal of financial responsibility. The 2019 Wylie ISD Bond will accommodate growth and update operational components that are in need of repair or replacement.
The fact is Wylie ISD is the 5th fastest growing school district in Dallas/Ft. Worth. We desperately need classroom space in many Wylie ISD campuses. To determine how to get more classroom space, we used a set of standards of financial responsibility to guide our master facilities planning process.
In fact, the solution presented is conservative as evidenced by the amount we asked for in comparison to recent examples of area school districts.
The 2019 Bond amount is not only a fraction of other fast-growth school district amounts of comparable size, we have sharpened the pencil even further to add on to schools rather than building new campuses. We save more than $90 million by adding on to buildings instead of building new ones.
ANSWERING YOUR QUESTIONS
I love answering questions from parents, teachers and taxpayers. My door is always open and keeping your trust is vital to the foundation of Wylie ISD. Honestly, I have not had many questions but this is what I have so far. They are in no particular order.
Question(s) #1
Why is so much of the bond directed to the high schools? Is the growth enough to justify a third high school?
Below is the projected enrollment for the two high schools through 2028. As you can see, the projected enrollment will exceed our current capacity. The projects contained in the bond will allow us to meet this growth. In fact, this size is proven to be the most efficient model based on our research. PLUS, this model saves approximately $10 million in annual operating expenses.
To create our plan, we visited with many area school districts. Our research revealed different costs, based on amenities and size capacities. Campus costs range from $122,000,000 for a campus enrollment much smaller than we are projecting to as high as $250,000,000 for a campus of equal size to our enrollment projections. The average cost is around $190,000,000 for a new high school in the DFW area.
Question(s) #2
How is Wylie ISD able to pass this bond without raising taxes? Is this just shifting debt?
The District’s tax rate has remained constant since 2010 at $1.64 per $100 of taxable appraised value. Of the District’s total tax rate, the portion restricted for the purposes of paying debt service has also remained constant at $0.47 since 2010. Under current projections by the District for future trends in taxable assessed value, the District anticipates its ability to repay future debt with a constant tax rate of $0.47. As development throughout the district continues and the value of existing properties continues to increase, as determined by the Collin County Appraisal District, the amount of revenue generated by the same tax rate increases over time. This allows the District to support the additional debt to be issued as approved by voters. The District is not in the practice of shifting or delaying the repayment of its debt, and continues to look for ways to repay outstanding bonds early, when possible.
Question #3
How does our tax effort effect the school district budget?
Funding for bonds is derived from a district’s tax base and sometimes with very limited state aid from outdated formulas. The Wylie ISD property tax base is comprised of 80% “rooftops” or residential properties versus commercial properties and thus has a lower tax base than surrounding districts. To demonstrate this below is a chart that reflects how a penny tax effort compares to surrounding districts:
What this chart shows is the construction dollar for school districts is worth, in some cases, 10 times as much as what Wylie ISD can raise with the same effort. As you can see, our dollar goes half as far as the next poorest district. This means we had to do everything possible to accommodate growth without some of the “frills” other districts offer in their bond proposals.
School districts that are considered fast-growth and a low tax base, such as Wylie ISD, have challenges to build to accommodate growth. Capital Appreciation Bonds were utilized in order to stay under the $.50 test and within the bond capacity in order to meet the necessary bond payments.
A further explanation on this can be found on the Comptroller’s website: https://comptroller.texas.gov/economy/fiscal-notes/2016/march/cab.php
No Capital Appreciation Bonds have since been issued, starting with the 2019 bond which are all Current Interest Bonds.
The Wylie ISD Board of Trustees is committed to restructuring the debt to minimize the tax burden on our local taxpayers. In fact, within the past year, the Board hired a new financial advisor that has already restructured debt in similar districts saving millions of dollars to local taxpayers.
Question #4
George W. Bush is our newest school and it’s already near capacity. Was this anticipated?
Yes, when we first started planning for Bush Elementary in the 2014 bond we prepared for 900 students, but built the core space for 1,000 students. This allowed us to stay within the promised budget. Since the school opened in 2016, Huffines Communities has reduced the lot sizes for houses which creates more homes in the same space AND added new developments. The additional classrooms will meet these needs and still keep the school within its functional capacity.
Question #5
Voter turnout was very low. I know there were several public meetings, but what else did the district do to help inform the community?
We began planning for this bond almost two years ago through our Master Facilities Planning meetings. We sought input from staff and community stakeholders, continually refining the proposed projects. The Board discussed these projects during the September, 2018 board meeting before officially calling for the election in December, 2018.
We provided numerous bond presentations to the public:
2019 Bond Awareness
All 20 Wylie ISD campuses
Multiple Superintendent Blog Posts
Master Facilities Planning Updates
Bond fact sheets for each campus, sent to all parents
Public Meetings
Board Meetings
Board Workshops
Numerous PTA meetings (Where public was invited)
East Fork Rotary Club
Wylie Chamber of Commerce
Sachse Chamber of Commerce
The Masonic Lodge
Wylie Senior Citizens Groups
Wylie CLAAS
Leadership Wylie
Leadership Sachse
Social Media
Dedicated website
Weekly “Bond Fact” reminders sent to all Wylie parents that included Q&As, voter registration information and early voting and Election Day information
Media
Numerous news stories in the Wylie News
All required legal postings, including notice of election and ballot language
We were careful never to say “vote for” any bond. We simply asked everyone to vote. Most school district bond proposals have “Political Action Committees” created by the community to promote a bond. Wylie ISD intentionally asked that a PAC committee not be organized. We believe that people should be able to make their own objective decisions based on facts.
Based on Collin County Election information, Wylie ISD employee voter turnout was extremely low. It was slightly higher than the general public, but not by much. In short, our entire voter turnout was incredibly low.
Question #6
Wylie ISD faces the challenge of being fast-growth and having to rely primarily on property tax for revenue in the Debt Service Fund (i.e. Interest and Sinking Fund). How do you manage the budget to ensure financial responsibility?
Over the past 5 years, the debt service fund (also called Interest and Sinking Fund) has been reduced by $26 million due to bond refunding. Our next callable bonds are in 2020 in which the Board will review for the best option in minimizing the overall debt resulting in tax savings. You can see the results of this in the graph below demonstrating the reduction in debt per student over the past several years. Wylie ISD trustees share your conservative approach to debt management. Managing debt and dealing with extreme growth has been a challenge, but we have found success and will continue to strive to do so.
Over the past eight years, we have worked diligently to improve our bond rating. We have done this based on specific recommendations from bond rating companies like Moody’s and Standard and Poor’s. The main reason for these upgrades, the rating agency cites great financial management. These efforts have resulted in seven credit rating improvements. We are proud of this and have a plan to keep climbing.
Question #7
Can you explain a little more about how Wylie ISD’s budgeting works?
As with all things related to finance, we tend to take a conservative approach. All of the day-to-day operations are under the General Fund budget. Under law, these funds are separate from bond funds (Interest and Sinking) and one can not be used to fund the other. There are a lot of uncertainties, especially in this legislative year. Our biggest expenditure is salaries (about 84% of out total budget) and we are at the mercy of our lawmakers.
General Fund Budgets are mainly funded based on two factors:
1) Enrollment
2) Property Values
Wylie ISD has a July – June fiscal year and adopts the budget in June as per board policy. Enrollment and property values are both unknown factors at the time the budget is adopted. Enrollment funding is based on the last Friday in October and property values are based on certified values in July. For this reason, Wylie ISD conservatively budgets these two factors. Actuals for both were above budget for the 2018-2019. The 3% budget projection for 2019-2020 is actually higher than a 3.3% projection for 2018-2019 because the base numbers increase each year. (Example: 10,000 students x 3.3% = 10,330, increase of 330 students; 10,330 x 3% = 10,639.9, increase of 339.9 or 340 students).
Despite these challenges, this Board is committed to adopting a balanced budget every year and staff works hard to meet this goal. We will continue to watch the news from Austin, as well as Collin County, and only propose a budget that we know will be sound.
MORE QUESTIONS?
Seriously, I love your input, ideas and questions. I am happy to respond anytime. Trust is earned. I appreciate your faith in me. Feel free to reach out with additional questions, david.vinson@wylieisd.net.
