Giddings ISD Financial & Debt Summary 2018

Annual Report of Certain Financial and Local Debt Information Fiscal Year Ended August 31, 2018 Denotes Required Information Pursuant to Local Government Code, Section 140.008 This report was posted on the District s website on ___________________________.

Overview of Certain Financial/Bond Ratings Overview: Giddings Independent School District (the District ) has been assigned the following independent financial/bond ratings that indicate the relative strength of the District s financial and debt management: School Financial Integrity Rating System of Texas ( FIRST ): Pursuant to Subchapter D, Chapter 39 of the Texas Education Code, the State annually deploys a financial accountability rating system to distinguish the level of a school district s financial performance based upon certain uniform criteria. Based on data for year 2016/17, the District was assigned a 2017/18 FIRST Rating of Superior and the District s score was 94 out of a possible 100 points. Credit Ratings: The District also maintains independent ratings from certain nationally recognized credit rating agencies, such as Moody s Investors Service that evaluate the District s financial strength and its ability to pay its existing bonds. Moody s Investors Service: Assigns a A1 credit rating to the District, defined as Judged to be of upper-medium grade and are subject to low credit risk. 1

Overview of State Funding System State Funding System Where Do the District s Revenues Come From: Giddings ISD is legally required to operate pursuant to the requirements of the Texas Education Code. In particular, the Texas Education Code determines the District s ability to generate local tax revenues for maintenance & operation purposes and for the repayment of voter-approved bonds. In this regard, the District annually sets two (2) separate tax rates that are levied upon its certified taxable value that is independently determined by the Lee Central Appraisal District and the Fayette and Washington County Appraisal Districts: Maintenance & Operations ( M&O ) Tax Rate: To provide funds for the day to day operational expenses of the District, including instructional programs, teacher salaries, instructional supplies, security, student transportation, infrastructure/maintenance, etc. The District s annual funds for maintenance & operation purposes primarily consist of a combination of State funding and local M&O taxes. In general, the dollar amount of each component is determined by the District s Equalized Wealth per Student (i.e. taxable value / weighted average daily attendance) as set by the State. For year 2017/18, the District s sources for M&O revenues are summarized on the right. extracurricular activities, utilities, facility M&O Revenue by Source Year 2017/18 Federal (2.2%) Local (50.1%) State (47.6%) 2 Source: District s Audited Financial Statements and District records.

Overview of State Funding System Interest & Sinking Fund ( I&S ) Tax Rate: To provide funds to pay the principal and interest on bonds approved by a majority of voters for capital improvements. The following summarizes the District s bond programs approved by voters over the last 17 years: District s Historical Bond Elections Approved By Voters Dollar Amount Remaining To Be Issued $0 $130,000 $0 $130,000 Student Enrollment 1,760 1,886 1,886 Election Date February 2, 2002 May 12, 2007 May 12, 2007 Total Dollar Amount Of Authorized But Unissued Bonds - As of August 31, 2018: Purpose School Building School Building Cafetorium Election Amount $1,200,000 $36,900,000 $1,100,000 3 Source: Texas Bond Review Board, Texas Education Agency - PEIMS, District s Audited Financial Statements and District records.

Historical Student Enrollment 2,500 Over the last 5 years, the number of students within the District has decreased by 21 or a decrease of (1.09%). 2,250 1,961 2,000 1,931 1,929 1,922 1,909 1,901 Student Enrollment 1,750 1,500 1,250 1,000 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 4 Source: Texas Education Agency - PEIMS and District records.

Full-Time Equivalent Personnel 400 Over the last 5 years, the District s full-time equivalent personnel has decreased by 18. 350 300 274 267 263 262 262 256 Full-Time Equivalent Personnel 250 72 63 65 91 71 59 200 11 11 12 11 11 13 13 10 13 14 15 22 150 100 174 172 171 169 166 152 50 0 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Teachers & Paraprofessional Staff Support Staff Administrators Auxiliary Staff (i.e. bus drivers, food service, etc.) 5 Source: Texas Education Agency - PEIMS, Texas Education Agency - AEIS and District records.

Full-Time Equivalent Personnel Per Student 0.2000 For year 2017/18, the District employed 0.1346 full-time equivalent personnel per student. 0.1800 Full-Time Equivalent Personnel Per Student 0.1600 0.1423 0.1380 0.1361 0.1357 0.1355 0.1346 0.1400 0.1200 0.0373 0.0325 0.0312 0.0338 0.0472 0.0369 0.1000 0.0059 0.0059 0.0064 0.0060 0.0057 0.0069 0.0069 0.0050 0.0068 0.0079 0.0071 0.0113 0.0800 0.0600 0.0906 0.0901 0.0887 0.0868 0.0863 0.0400 0.0788 0.0200 0.0000 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Teachers & Paraprofessional Staff Support Staff Administrators Auxiliary Staff (i.e. bus drivers, food service, etc.) 6 Source: Texas Education Agency - PEIMS, Texas Education Agency - AEIS and District records.

Historical Tax Rates $2.00 Over the last 5 years, the District s total tax rate has decreased by 2.0 cents. $1.75 $1.42000 $1.42000 $1.50 $1.40000 $1.40000 $1.40000 $1.40000 Property Tax Rate Per $100 Valuation $1.25 $0.30000 $0.30000 $0.30000 $0.38000 $0.38000 $0.36000 $1.00 $0.75 $1.10000 $1.10000 $1.10000 $1.04000 $1.04000 $1.04000 $0.50 $0.25 $0.00 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Maintenance & Operations Tax Rate Interest & Sinking Fund Tax Rate 7 Source: District s Audited Financial Statements and District records.

Historical Total Property Taxes For Maintenance and Operations andVoter-Approved Bonds ForVariousAppraisedHomeValues $4,000 $3,500 $3,621 $3,621 $3,570 $3,430 $3,430 $3,430 $3,000 Annual Property Taxes $2,500 $2,343 $2,343 $2,310 $2,170 $2,170 $2,170 $2,000 $1,500 $1,000 $1,065 $1,065 $1,050 $910 $910 $910 $500 $0 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 $100,000 Appraised Home Value $200,000 Appraised Home Value $300,000 Appraised Home Value 8 Note: Taxes are net of the State-mandated residential homestead exemption and a 10% local option, additional homestead exemption.

Summary of Property Tax Cost Per School Day For Various Appraised Home Values Year 2017/18 $25.00 In year 2017/18, a homeowner with a $200,000 Appraised Home Value and no children attending Giddings ISD paid approximately $12.06 of school property taxes for each school day. A homeowner with a $200,000 Appraised Home Value and 2 children attending Giddings ISD paid approximately $6.03 of school property taxes per child for each school day. This includes the cost of instructional programs, teacher salaries, instructional supplies, security, student transportation, extracurricular activities, facilities infrastructure/maintenance and bond payments. $20.00 $19.06 Cost Per School Day $15.00 $12.06 $9.53 $10.00 $6.35 $6.03 $5.06 $4.76 $5.00 $4.02 $3.01 $2.53 $1.69 $1.26 $0.00 0-1 Child 2 Children 3 Children 4 Children $100,000 Appraised Home Value $200,000 Appraised Home Value $300,000 Appraised Home Value Note: Taxes are net of the $25,000 State-mandated residential homestead exemption and a 10% local option, additional homestead exemption.. Assumes a 180 school day year. 9

Composition of Total Assessed Valuation Year 2017/18 For year 2017/18, Single-Family Residential properties comprised 11.8% of the District s total assessed valuation and other property categories comprised 88.2%. Oil, Gas & Minerals (4.6%) Business, Commercial, Industrial, Utilities, Other (21.2%) Vacant Lots, Acreage, Farm & Ranch Improvements (61.7%) Single-Family Residential (11.8%) Multi-Family Residential (0.7%) 10 Source: Texas Comptroller.

Historical Taxable Assessed Valuation and Taxable Value Per Student Enrollment $1.0 Billion $500,000 The District s taxable value per student has increased from $385,005 to $413,745 over the last 5 years. $900 Mil $450,000 $800 Mil $424,682 $810,718,365 Taxable Value Per Student Enrollment $413,745 $400,000 $786,529,258 $781,633,728 $766,195,388 $398,589 $396,787 $739,978,753 $700 Mil $732,227,388 $385,005 Taxable Assessed Valuation $379,589 $350,000 $600 Mil $500 Mil $300,000 $400 Mil $250,000 $300 Mil $200,000 $200 Mil $150,000 $100 Mil $0 $100,000 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Taxable Assessed Valuation Taxable Value Per Student Enrollment 11 Source: Texas Comptroller, Texas Education Agency - PEIMS and District records.

General Fund and Debt Service Fund Revenue By Source Given the State funding system is structured to provide the District with an equalized dollar amount per student, the decrease in the number of students has increase the percentage of M&O revenues received from the State from 43.6% to 47.6% over the last 5 years. Year 2012/13 M&O Revenue by Source Year 2017/18 M&O Revenue by Source Federal (2.2%) Federal (0.5%) Local (50.1%) State (43.6%) Local (56.0%) State (47.6%) I&S Revenue by Source I&S Revenue by Source State(A) (2.2%) Local (97.8%) Local (100.0%) ________ (A) Represents payment from State received for lost tax revenues resulting from increase of residential homestead exemption in year 2015/16. 12 Source: District s Audited Financial Statements and District records.

Total Revenues (All Governmental Funds*) By Source $25 Mil $23,204,926 $21,364,441 $21,331,676 $1,939,360 $21,067,184 $20,359,446 $20,293,778 $1,788,207 $1,737,187 $20 Mil $2,123,654 $1,783,708 $1,962,435 $9,042,623 $7,765,484 $7,958,431 $15 Mil $7,015,192 $7,905,668 $6,825,646 Revenues $456,430 $1,619,966 $535,387 $411,894 $577,833 $880,624 $10 Mil $11,354,320 $11,148,652 $11,100,671 $10,927,864 $10,602,977 $5 Mil $10,157,238 $0 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Property Taxes Property Taxes(A) Other Local & Intermediate Sources State Program Revenues Federal Program Revenues (A) Includes maintenance and operation expenses and bond payments of voter-approved bonds. 13 *Excludes Capital Projects Fund. Source: District s Audited Financial Statements and District records.

Total Revenues (All Governmental Funds*) Per Student $14,000 $12,207 $12,000 $11,174 $1,020 $10,921 $10,895 $10,559 $10,543 $910 $912 $1,101 $924 $10,000 $1,021 Revenues Per Student $4,757 $4,169 $8,000 $3,960 $3,633 $4,098 $3,551 $6,000 $852 $280 $233 $213 $301 $457 $4,000 $5,815 $5,790 $5,774 $5,686 $5,578 $5,266 $2,000 $0 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Property Taxes Property Taxes(A) Other Local & Intermediate Sources State Program Revenues Federal Program Revenues (A) Includes maintenance and operation expenses and bond payments of voter-approved bonds. 14 *Excludes Capital Projects Fund. Source: District s Audited Financial Statements, Texas Education Agency - PEIMS and District records.

Total Expenditures (All Governmental Funds*) By Source $25 Mil $21,787,681 $20,801,960 $20,777,867 $20,625,963 $20,370,968 $1,270,097 $19,994,782 $1,100 $331,989 $65,795 $0 $20 Mil $197,042 $2,379,743 $3,001,470 $2,514,745 $3,122,926 $2,957,768 $2,927,753 $3,933,494 $3,998,506 $3,815,687 $3,972,911 $4,555,215 $15 Mil $3,591,034 Expenditures $627,995 $1,051,636 $956,086 $984,508 $976,078 $981,602 $10 Mil $13,576,352 $12,806,081 $12,665,469 $12,554,784 $12,302,875 $12,238,480 $5 Mil $0 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Instruction & Instructional Support Central Administration District Operations Debt Service Other 15 *Excludes Capital Projects Fund. Source: District s Audited Financial Statements and District records.

Total Expenditures (All Governmental Funds*) Per Student $14,000 $11,461 $12,000 $10,897 $10,760 $10,560 $10,518 $668 $10,403 $174 $1 $0 $34 $103 $1,252 $10,000 $1,554 $1,549 $1,304 $1,593 $1,523 Expenditures Per Student $2,069 $2,073 $2,081 $8,000 $2,359 $1,946 $1,868 $330 $545 $516 $488 $508 $508 $6,000 $4,000 $7,142 $6,639 $6,577 $6,459 $6,401 $6,338 $2,000 $0 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Instruction & Instructional Support Central Administration District Operations Debt Service Other 16 *Excludes Capital Projects Fund. Source: District s Audited Financial Statements, Texas Education Agency - PEIMS and District records.

Unrestricted General Operating Fund Balance as a Percentage of General Operating Expenditures 35.00% Unrestricted General Operating Fund Balance is a reserve maintained to meet future expenses, which equaled approximately 3.85 months of the District s operating expenditures for year 2017/18. The Texas Education Agency and the bond rating agencies rely upon a school district s General Operating Fund Balance to determine financial management ratings. 32.09% Unrestricted General Operating Fund Balance Per Expenditures 30.00% 26.52% 25.00% 21.38% 20.00% 18.13% 15.21% 15.00% 13.18% 10.00% 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 17 Source: District s Audited Financial Statements and District records.

Unlimited Tax Debt Service By Series Existing Bonds Approved By Voters $3,000,000 $2,500,000 Annual Bond Payments $2,000,000 $1,500,000 $1,000,000 $500,000 $0 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 2034/35 2035/36 2036/37 Unlimited Tax Refunding Bonds, Series 2014 Unlimited Tax Refunding Bonds, Series 2015 Unlimited Tax Refunding Bonds, Series 2016 Unlimited Tax Refunding Bonds, Series 2017 Note: Debt service payments reflect payments from September 1 through August 31. 18 Source: District s Audited Financial Statements and District records As of August 31, 2018.

Unlimited Tax Debt Service By Principal and Interest Existing Bonds Approved By Voters $3,000,000 As of August 31, 2018 Principal + Interest = Total $30,560,000 12,986,750 $43,546,750 $2,500,000 Annual Bond Payments $2,000,000 $1,500,000 $1,000,000 $500,000 $0 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 2029/30 2030/31 2031/32 2032/33 2033/34 2034/35 2035/36 2036/37 Principal Interest Note: Debt service payments reflect payments from September 1 through August 31. 19 Source: District s Audited Financial Statements and District records As of August 31, 2018.

Savings from Districts Recent Bond Refunding Programs to Lower Interest Costs Giddings ISD has implemented 4 bond refunding programs to reduce the cost of voter-approved bonds Which have generated more than $6.296 million of savings for District taxpayers in recent years. Summary of Interest Cost Savings Bond Refunding Programs Principal Amount Refunded 8,840,000 $ 9,080,000 9,450,000 5,885,000 33,255,000 $ Issue Unlimited Tax Refunding Bonds, Series 2014 Unlimited Tax Refunding Bonds, Series 2015 Unlimited Tax Refunding Bonds, Series 2016 Unlimited Tax Refunding Bonds, Series 2017 Totals Series Refunded 2007-A 2007-A 2007-A 2007-A --- Total Savings $ 2,287,200 2,596,750 6,296,786 $ 891,330 521,506 20 Source: District records.

Summary of Unlimited Tax Debt Outstanding By Series As of Fiscal Year Ended August 31, 2018 Original Principal Amount $8,575,000.00 Outstanding Principal Per Capita $848.25 Outstanding Debt Service Per Capita $1,054.65 Final Maturity Date 02/15/2027 Total Proceeds Received $9,748,395.90 Outstanding Principal $8,575,000.00 Total Outstanding Debt Service $10,661,500.00 Spent Proceeds $9,748,395.90 Unspent Proceeds No. 1 Issue Description Unlimited Tax Refunding Bonds, Series 2014 Purpose Refunding at a lower interest rate, etc. $0.00 2 Unlimited Tax Refunding Bonds, Series 2015 Refunding at a lower interest rate, etc. $8,820,000.00 $8,820,000.00 $14,810,400.00 $872.49 $1,465.07 02/15/2037 $9,874,502.37 $9,874,502.37 $0.00 3 Unlimited Tax Refunding Bonds, Series 2016 Refunding at a lower interest rate, etc. $8,660,000.00 $8,660,000.00 $12,950,200.00 $856.66 $1,281.06 02/15/2033 $9,903,001.90 $9,903,001.90 $0.00 4 Unlimited Tax Refunding Bonds, Series 2017 Refunding at a lower interest rate, etc. $8,660,000.00 $4,505,000.00 $5,124,650.00 $445.64 $506.94 02/15/2028 $5,939,390.43 $5,939,390.43 $0.00 21 Source: District s Audited Financial Statements, 2010 U.S. Census (Interpolated) and District records. Per capita figures based on an estimated population of 10,109.

Tax-Supported Debt Obligations At Fiscal Year End and As a Percentage of Taxable Assessed Valuation $55 Mil 6.00% $50 Mil 5.05% 4.77% 5.00% Bond Principal Outstanding At Fiscal Year End Bond Principal Per Taxable Assessed Valuation $45 Mil 4.48% 4.33% $40 Mil 4.08% $37,375,000 $36,585,000 3.89% $35,000,000 4.00% $33,113,000 $35 Mil $31,710,000 $30,560,000 $30 Mil 3.00% $25 Mil $20 Mil $37,375,000 2.00% $36,395,000 $34,855,000 $33,015,000 $31,660,000 $30,560,000 $15 Mil $10 Mil 1.00% $5 Mil $0 0.00% $190,000 2013/14 $145,000 2014/15 $98,000 2015/16 $50,000 2016/17 $0 $0 2012/13 2017/18 M&O-Supported Debt I&S-Supported Debt 22 Source: District s Audited Financial Statements, Texas Comptroller and District records.

Inflation-Adjusted Tax-Supported Debt Per Capita $6,000 Reflects an estimate of District s principal amount of tax-supported debt outstanding per capita, with years 2012/13 - 2016/17 adjusted by rate of inflation portrayed by the Consumer Price Index. $5,000 $3,922 Bond Principal Per Capita $3,765 $4,000 $3,540 $3,408 $3,172 $3,023 $3,000 $2,000 $3,922 $3,745 $3,526 $3,398 $3,167 $3,023 $1,000 $0 $20 $15 $10 $5 $0 $0 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Inflation-Adjusted M&O-Supported Debt Per Capita Inflation-Adjusted I&S-Supported Debt Per Capita 23 Source: District s Audited Financial Statements, 2010 U.S. Census (Interpolated), Bureau of Labor Statistics and District records.

Inflation-Adjusted Tax-Supported Debt Cost Per Capita Principal and Interest In Each of the Last 5 Years $450 Reflects an estimate of local property taxes paid per capita for District s principal and interest cost of I&S-supported debt, with years 2012/13 - 2016/17 adjusted by rate of inflation portrayed by the Consumer Price Index. Local Taxpayer Cost Per Capita - Tax-Supported Debt Payments $400 $350 $308 $306 $295 $300 $247 $250 $225 $218 $200 $150 $100 $50 $0 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Note: Debt payments represent District s voter-approved bonds payable from a levy of its I&S tax rate. 24 Source: District s Audited Financial Statements, 2010 U.S. Census (Interpolated), Bureau of Labor Statistics and District records.

Contact Information and Links to Additional Resources Main Office Contact Information: Physical and Mailing Address: 2337 N. Main Street Giddings, Texas 78942 Phone: (979) 542-2854 Fax: (979) 542-9264 For additional information regarding this report, please contact: Mr. Roger Dees Superintendent of Schools Phone: (979) 542-2854 Email: roger.dees@giddings.txed.net Links to Additional Resources: https://www.comptroller.texas.gov/transparency/local/debt/isds.php http://www.brb.state.tx.us/local_debt_search.aspx 25