Teacher Retirement System
2002 School Effective M&O Rates Certified to TRS
In July, the Comptroller certified to the Teacher Retirement System (TRS) the 2002 statewide average school effective maintenance and operations (M&O) rate. The rate uses the taxable value findings of the 2002 Comptroller's Property Value Study (PVS).
The Comptroller calculated a 2002 statewide average effective M&O rate of $1.439744 per $100 of value. The certification also includes each individual school district's effective M&O rate, based on the district's PVS finding. The 2001 statewide average effective M&O rate was $1.414493.
Both independent school districts (ISDs) and the state share the expense of the employer's contribution to the TRS. State law requires school districts to pay the state's part for members whose salaries exceed the statutory minimum and that TRS collect that part from those districts. A school district with a tax rate that is 125 percent or more above the statewide average M&O rate, however, is not required to contribute the state's part to the TRS.
The statewide average M&O rate adjusted for 125 percent is $1.799681. Only four school districts had rates that exceeded this adjusted statewide average, compared with eight districts in the preceding year. The four ISDs are Lefors ISD in Gray County, Hardin-Jefferson ISD in Hardin County, Midlothian ISD in Ellis County and Sabine Pass ISD in Jefferson County.
State law prescribes a formula to determine the statewide average effective M&O rate. The Government Code defines this rate as the tax rate that, if applied to the Comptroller's statewide school district taxable values, would produce an amount equal to the M&O taxes levied by all school districts in the previous year. The Comptroller gathers each district's M&O rate annually and determines the statewide average rate by statutory formula. Because the certified rate is an effective rate based on the Comptroller's values, the certified rate may exceed $1.50 per $100 of value (the state limit on a school district’s adopted M&O rate) and may differ from the school's adopted rate that uses the district's local values.
School district officials with questions about the state contribution should contact Margie Horton, Teacher Retirement System, at 512/397-6488.