Eligible school boards can raise tax rates without another vote

Eligible school boards can raise an existing local school tax rate by up to 2% of the previous fiscal year’s rate without another vote. This authority covers school districts collecting local taxes under Chapter 19. It does not cover county vocational-technical districts. The district’s operating reserves must be no more than 10% of its annual revenue. An increase cannot occur in the same fiscal year as a tax rate reset following a county reassessment of property values. State funding cannot be reduced in later tax years because the district used this authority. The authority starts in fiscal year 2031 or after the district first sets a new tax rate following a county reassessment conducted after enactment, whichever comes first.

School boards must set tax rates after county property reassessments using a revenue limit based on operating revenue and average growth in taxable property over the previous five years. The calculation applies to regular school districts and county vocational-technical districts. The revenue limit uses the prior fiscal year’s actual operating revenue as its starting point. If reassessment occurs after voters approve a tax or tax increase but before it produces revenue, the limit instead uses the expected operating revenue from that approval. The formula applies to reassessments on or after January 1, 2026. Earlier reassessments remain under the separate 10% revenue-increase limit.