HOUSTON — Houston voters will decide on $4.4 billion bond proposal from the Houston Independent School District in the November election.
Voters on Nov. 5 will need to decide whether to approve or reject the bond proposal which is broken down into two separate propositions.
Proposition A asks voters to approve the issuance of $3.96 billion in bonds, aimed at addressing critical needs in the district’s infrastructure.
Then there is Proposition B which is aimed at upgrading the district’s technology infrastructure. Prop. B would issue $440 million to fund technology improvements across HISD schools.
The bond would be the first in 12 years for HISD and the largest in the state’s history.
Supporters for the proposal said the measure was an important opportunity to improve HISD schools while opponents have expressed skepticism and distrust of state-appointed Superintendent Mike Miles and the state-appointed board of managers.
Recently, KHOU 11's Maria Aguilera reported on how both Harris County Democrats and Republicans opposed the bond. Democrats cited a lack of trust for state-appointed superintendent Mike Miles and an unelected board. Republicans cited declining enrolment and families facing economic difficulties. You can read her report here.
Here's a breakdown of both propositions and what they could mean for HISD and local taxpayers.
What is Proposition A on the HISD bond election?
Proposition A proposes the issuance of $3.96 billion in bonds to fund several projects within the HISD, including:
- Construction of new school buildings to accommodate growing student enrollment
- Renovation and expansion of existing schools to update facilities that may be outdated or in need of repair
- Safety and security upgrades for school buildings
- Purchase of land for future school sites
The bond is aimed at improving the district’s infrastructure, expanding capacity, and modernizing safety systems.
What will the bond cost?
The financial commitment associated with this bond is significant. If Proposition A is approved, HISD will borrow $3.96 billion.
The estimated interest on this debt is projected to be $4.43 billion, bringing the total repayment amount, which is the principal plus interest, to $8.39 billion over the life of the bond. This repayment period is expected to span 30 years, with bond issuances spread over four years, from 2025 to 2028.
What is Proposition B on the HISD bond election?
Proposition B would authorize the district to issue $440 million in bonds to fund:
- Technology equipment and systems for students and teachers, including updated devices, software, and digital learning tools
- Technology infrastructure improvements, such as better network connectivity, cybersecurity measures, and system enhancements
- Instructional technology upgrades, ensuring classrooms are equipped with modern tools for digital learning, including computers, tablets, and smart boards
What will the bond cost?
If Proposition B is approved, the district would borrow $440 million, with an estimated interest cost of $89.4 million. This would bring the total repayment to $529.4 million over the life of the bonds.
Current debt obligations of HISD
HISD currently has $1.77 billion in outstanding debt, with $664 million in remaining interest payments. If Proposition A and B are approved, this would add to the district’s total debt, bringing the total amount to be repaid, including outstanding obligations, to $10.9 billion.
Will there be a property tax increase?
Though the ballot will state “THIS IS A PROPERTY TAX INCREASE,” HISD said they don't anticipate needing to raise the tax rate to repay the bond.
Based on current projections, the district estimates that the maximum annual increase in taxes on a home valued at $100,000 will be $0.00. However, this assumes several factors remain constant, including the projected increase in property values and interest rates.
The assumptions that inform this estimate include:
- Appraised property values are expected to increase by 0.64% in 2025 and by 1.00% annually thereafter
- The district anticipates issuing bonds with an interest rate of 5.50%.
- The bond repayment will occur over a 30-year term, with four separate bond issuances
- The state-mandated homestead exemption for primary residences, which reduces the taxable value by $100,000, applies in this case
While HISD does not foresee an immediate tax rate hike, any significant changes in market conditions or lower-than-expected property value growth could lead to an adjustment in the tax rate in future years.
What will the funding be spent on?
Here is a broad breakdown of how the $4.4 billion investment will be spent. HISD broke it down into three main buckets: Safe and healthy schools, future ready and restoring Houston’s schools.
Safe and healthy schools
The estimated total for this investment is $1.04 billion:
- $384.16 million for security upgrades at 263 campuses and 25 non-campus facilities
- $2.15 million for HISD police upgrades
- $508.34 million for HVAC upgrades at 100 campuses
- $149.62 million for lead abatement at 134 campuses
Future ready
The estimated total for this investment is $1.07 billion:
- $375 million for three new CTE centers in the North, South and West divisions
- $50 million for the renovation of the Barbara Jordan Career Center
- $200 million for the pre-K expansion with 4,000 new seats
- $445 million for district-wide technology and IT upgrades
Restoring Houston schools
The estimated total for this investment is $2.29 billion:
- This is for 43 individual school investments to address urgent facility needs