Mission Statement

Red Oak Independent School District is dedicated to sound financial management through integrity, prudent stewardship, planning, accountability, full disclosure, and open communication. The purpose of the Business Services Department is to enable the District to achieve and maintain a stable, long-term financial condition, to provide guidelines for the day-to-day planning and operations of the District's financial affairs and to communicate the District's financial practices with stakeholders.

Financial Information and Transparency

The District provides transparent and accountable financial information to the communities of Red Oak ISD so they can make informed decisions about the financial stability of the District.  Financial Transparency is achieved through presenting financial reports and relevant information in a format that is easily understandable.  As part of this continuing commitment to transparency and accountability, the Business Services Department has developed this page to provide the communities with more direct access to data on the District’s revenues, expenditures, tax rates and other required postings.  This information for the last thirteen (13) years is available in the Financial Documents link on the left panel.

As part of the District’s pledge to increase the level of financial transparency and engagement in the budgeting process and financial management, the Business Services Department has received the following state, national and international awards for the last five (5) years:

• ASBO Meritorious Budget Award
• ASBO Certificate of Excellence in Financial Reporting
• GFOA Certificate of Achievement for Excellence in Financial Reporting
• Texas Comptroller of Public Accounts Awards Traditional Finances Star
• TASBO Award of Merit for Purchasing Operations
• TASBO Award of Excellence in Financial Management

Budget Adoption Process 

School districts in Texas are required by law (Texas Education Code §44.001 – §44.006) to prepare an annual budget consisting of the General Fund, the Debt Service Fund and the Food Services Fund.  The annual budget is a detailed financial plan for the District and covers the fiscal year beginning July 1 through June 30.  The Red Oak ISD Budget must be approved by June 30^th each year.

When the proposed budget was prepared, a meeting was called for the School Board to adopt the annual budget.  As part of the process, a publication of the Notice of Public Meeting to Discuss the Budget and Proposed Tax Rate was placed in a local newspaper.  The notification was published in the Waxahachie Sun newspaper on May 29, 2024.  Below is a link to the Notice posted in the newspaper.  The Public Hearing on the Budget and Proposed Tax Rate was held on June 17, 2024 in the Red Oak ISD Board Room.  At the June Regular School Board Meeting, the Board only adopted the 2024-2025 Budget and not the 2024 Tax Rate.  The adoption of the 2024 Tax Rate cannot occur until after the certified taxable property values are received in July 2024.  The adoption of the 2024 tax rate took place at the School Board Meeting held on August 19, 2024.

At the time the Notice of Public Meeting to discuss the Budget and Proposed Tax Rate is published, a summary of the proposed budget must also be posted on the district’s website. The budget summary provides a side-by-side comparison of the current year’s actual budget with the next year’s proposed budget for the General Fund, Student Nutrition Fund and Debt Service Fund.  Information relating to per student and aggregate spending to support the District’s education programs and services is provided.  The budget is delineated by instruction, instructional support, central administration, district operations, debt service and other services.  Links to the budget approval documents are below.

Related Documents:

• Notice of Public Meeting to Discuss Budget and Proposed Tax Rate
• Proposed Budget for 2024-2025
• Adopted Budget for 2024-2025

Tax Rate Transparency

As part of the 86^th Legislative Session, the Texas Property Tax Reform and Transparency Act of 2019, was passed that implemented significant changes to the setting of local tax rates for cities, counties and school districts.  Starting in the 2019 tax year, a school district’s Maintenance and Operations (M&O) tax rate has been compressed when the Texas Comptroller’s determination of the statewide average growth is greater than 2.5%.  This State compression is referred to as the Maximum Compressed Rate (MCR) and only applies to the Tier 1 M&O tax rate component.  A district’s minimum MCR tax rate can only be 90% of the State MCR tax rate.  Additionally, a district’s MCR tax rate can be reduced to the 90% minimum each year if the value of its tax base rises more than 2.5%.  The goal under House Bill 3 with the state increasing school funding is to lower school district property taxes by including any loss of revenue in the Foundation School Program funding.

As part of the Texas Property Tax Reform and Transparency Act of 2019, additional tax calculations need to be made public to taxpayers to allow them to evaluate the relationship between taxes for the prior year and for the current year, based on the tax rate that would produce the same amount of taxes if applied to the same properties taxed in both years.

One of the calculations is the no-new-revenue tax rate.  The no-new-revenue tax rate is the tax rate for the current tax year that will raise the same amount of property tax revenue from the same taxable properties in both the prior tax year and the current tax year.  The caveat is that the calculation does not take into consideration the growth in taxable property values between the two (2) years.  The voter-approved tax rate is the highest tax rate that may be adopted without holding an election to seek voter approval to increase the M&O Tier 2 rate to a maximum of $0.17.

Per the Texas Tax Code Section § 26.05(b)(2), if the no-new-revenue tax rate is lower than the proposed tax rate, additional language is required in the resolution to adopt the tax rate.  It must state that the adopted tax rate will raise more taxes than last year’s rate and include the percent difference between the proposed M&O tax rate and the M&O no-new-revenue tax rate.  In most situations, this increase is due to the increase in property values, not the tax rate, which for most districts has decreased over the last several years.

Since the 2024 M&O no-new-revenue tax rate of $0.6965 is lower than the proposed M&O 2024 tax rate of $0.7552, additional language is required for this year in the resolution to adopt the 2024 tax rate. Also, this year's levy to fund maintenance and operations expenditures exceeds last year's maintenance and operations tax levy due to the 9.7% increase in values on the same taxable property as last year.

RED OAK ISD ADOPTED A TAX RATE THAT WILL RAISE MORE TAXES FOR MAINTENANCE AND OPERATIONS THAN LAST YEAR'S RATE.

THE TAX RATE WILL EFFECTIVELY BE RAISED BY 7.77% OVER THE NO-NEW REVENUE TAX RATE AND WILL RAISE TAXES FOR MAINTENANCE AND OPERATION ON A $100,000 HOME BY APPROXIMATELY $58.70.

The Red Oak ISD’s M&O tax rate has gone down by over 35.5% over the last six (6) years, including the 2024 tax year, but the overall property values in Ellis County have continued to go up due to more taxable property being developed and the escalation in the housing market.   Under the Foundation School Program funding model, if the State certified taxable property values increase, the amount of state funding will decrease, but if the M&O tax rate decreases, the state funding may increase.  Also, if the District does not adopt the tax rate approved by TEA, additional reductions in state funding will occur.  In order to provide a balanced budget, based on the reduction in state funding, the voter-approved tax rate has been adopted to maintain adequate funding for the 2024-2025 school year.

Related Documents:

• 2024 Truth in Taxation Form 50-859
• Resolution Setting the Tax Rate
• Tax Rate Notification
• 2024-2025 Fiscal Year Amended Budget