Dr. John Walch, left, director of Walch Educational Consulting, discusses a “tax swap” plan that will earn Big Spring Independent School District about $1 million more in the coming fiscal year during a BSISD trustees meeting Thursday evening. (HERALD photo/Steve Reagan)

By STEVE REAGAN    
Staff Writer
It is the closest thing to “money for nothing” that most of us will ever find.

Big Spring school trustees have a deal for you — accept basically the same tax rate as before but realize about $1 million more for the district this coming fiscal year.

By artificially zeroing out the Big Spring Independent School District debt service tax rate and raising the maintenance and operation tax rate at the same time, trustees can realize a net increase in revenue of up to $1 million in 2009-2010.

It may sound too good to be true, but thanks to the vagaries of state financial aid, this “tax swap” is completely on the up and up, school officials said.

Dr. John Walch, director of Walch Educational Consulting in San Antonio, briefed trustees on the “tax swap” plan during their regular monthly meeting Thursday evening.

Walch, a long-time educator, said the plan would allow BSISD to receive the maximum possible benefit from existing state financial aid legislation.

Like other school districts in Texas, BSISD's tax rate is split into two parts — maintenance and operations (M&O) and interest and sinking (I&S). M&O pays the day-to-day costs of the district, such as salaries and utilities, while I&S pays off district debt accrued from bond elections.

State aid to districts, however, is weighted heavily toward what the districts charge in the M&O portion of the tax rate — giving schools roughly 99 cents in aid for every $1 they raise in local M&O taxes. That fact provided the inspiration for the “tax swap” idea.

Walch told trustees that by canceling the I&S rate, which is currently 8 cents per $100 valuation at BSISD, while increasing the M&O rate (currently $1.04) by that same 8 cents would result in a significant increase in revenues next year — almost $2 million, by his estimates.

He said instituting the tax swap in 2009-2020 would result in BSISD receiving about $1.82 million in additional revenue. After making bond payments, the district would end with a net increase of about $1 million, Walch said.

There is a catch to the plan, however — it must receive voter approval.

Because the plan would result in BSISD increasing its M&O tax rate — however artificially — trustees would be required to hold a rollback election. Since the school financing system was overhauled in 2006, 252 districts have held rollback elections, with 71 percent of those elections passing voter muster.

Despite the inherent uncertainty of an election, officials believed they had to go forward with the plan.

“I think this shows people we're being financially responsible by trying to maximize revenue for our school district,” Superintendent Steven Saldivar said. “If we don't do this and people learn that we could have done it, they'll think we were dumb.”

This issue is even more clear-cut to Walch.

“If the rollback election passes, Big Spring's tax rate will be at $1.12 and the district will receive about $1.82 million more this coming year,” he said. “If the rollback election fails, the tax rate will still be $1.12 and that $1.82 million will be sitting on a table in Austin somewhere.”

Trustees will hold a public meeting Aug. 4 to discuss the district's proposed 2009-2010 tax rate and publicly call for a rollback election. The likely date for the election is Oct. 3.

In other business, trustees approved:

• An agreement that will allow the city of Big Spring to provide campus law enforcement services this coming school year.

• The Howard County Tax Appraisal District budget.

• Changes to the district's discretionary leave and secondary sick pool policies.

• The hiring of Oscar Aguero as the new principal at Washington Elementary.

Contact Staff Writer Steve Reagan at 263-7331 ext. 234 or by e-mail at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it