Andrews ISD offering raises to employees

Despite facing similar budget constraints as other districts, Andrews ISD gave raises to all of its nearly 600 employees.

Superintendent Bobby Azam said standard raises were already factored into the budget. The step increase is the pay raise the board considers annually.

The ability to offer a 1 percent matching investment annuity to employees who choose to participate was due to going with the TRS-ActiveCare system for insurance instead of staying self-funded.

“That is generally a 2 percent raise. The additional 1 percent is added, so that 1 percent put into the investment savings doesn’t cost the employee anything the first year. So the complete increase was 3 percent,” Azam said.

The district will match 1 percent of the employee’s salary.

If an employee makes $50,000, they can invest $500 into this retirement account. The district will match that $500 into the investment for the employee.

Azam said employees do’t have to participate. The district will only match if the employee takes part.

“So if the employee does not participate, then no problem. It’s available for employees who want to have the district contribute to their retirement …,” he said.

The ability to offer a matching investment annuity to employees who choose to participate was due to going with the TRS-ActiveCare system for insurance instead of staying self-funded.

“We were self-funded, which was great insurance for our people, but it cost the district an arm and a leg. We were able to go to the TRS-ActiveCare system for insurance and still provide all the insurance for employees. They really won’t see any difference. At the same time, we were able to free up that money to do other things,” Azam said.

They are also offering a match for an annuity.

“We were able to give our teachers their standard raise, which was a step on the pay scale and then we added 1 percent so that first year’s matching annuity didn’t cost them anything. That’s a pretty good benefit to the employees,” Azam said.

Their property values are exceeding $10 billion this year, so that means the district will have to send more money to the state for recapture, also known as Robin Hood.

AISD has a budget of about $50 million, but they usually operate with $30 to $25 million.

Andrews ISD was an original part of the Robin Hood system. As a result, its overall recapture amount is approaching $400 million.

“That’s not something we like, but we had no choice. We’ve paid recapture since its inception in 1993, so we had to figure out a way to combat the loss of millions of dollars in taxes taken by the state in order to provide for our district, the community, etc. The I&S tax was the only way to do so. The state currently cannot recapture I&S funds, so lowering the M&O means less is sent to Austin. Increasing the I&S tax means more money stays in our district. Our citizens understand that if or when there is any way to keep tax money here in Andrews we’re all for it.

“We’ve built and delivered what we promised to build and deliver with each bond. All the while, we’ve been able to successfully keep taxes very low. It takes work, but it has allowed us to provide for our students and teachers,” he added.

M&O stands for maintenance and operations and funds the day-to-day operations of districts.

Azam said he expects to have a $1.9 million deficit, but he believes it will be balanced by the end of the year.

“This year we’re probably going to send $20 to $30 million away in recapture, which is a lot for us. It’s not a huge amount when you look at Midland and all those guys when you look at the pure dollars, but percent-wise it’s just the same. We’re losing a lot of money out the door,” he added.

Azam said Andrews ISD is feeling the same budget constraints as everyone else.

“But we were able to shift and cut some things in our extracurriculars. We still have extracurriculars, but we were able to cut some of the costs and that way it’s where we can do the raises for our people. We’re really excited about that,” he added.

There may be a couple of positions that don’t get filled, but it won’t really impact class size.

“We’re pretty low on class size anyway, so even if we don’t fill a position that we want, we try to go about 17 in the elementaries,” Azam said.

If they don’t fill a position at the elementary level, a class could go up to 21, but that’s below the 22-1 student to teacher ratio required by the state for the elementary level.

“We’re like everybody else we’re having a hard time finding certain teachers. Certain positions are just tough to find, but we’re very fortunate. I’ve got a great board now and great boards in the past that have worked well but they’ve also listened to us when we’re showing them the trends and showing them what’s taking place in the state,” Azam said.

“We’ve been able to, over time, trim and then also take advantage of some opportunities we’ve had with different other investments and 313 agreements. So overall we feel very fortunate that we can give our people not only a raise but also offer them this retirement-type matching annuity which will be good for them,” he added.

With state-mandated tax compression, AISD’s total tax rate is 88 cents per $100 valuation. Over the years, the state has forced districts’ tax rate down.

The maintenance and operation tax is what the state has mandated be reduced.

“Our I&S (interest and sinking) tax rate, related to our bonds is low because we receive initial authorization from the voters for the entire amount, but we sell bonds when necessary for projects, etc. We don’t sell all the bonds up front. That way we only pay for what we’ve sold. We’ve done this since 2011 and we’ve been able to keep the tax rate low while paying off the bonds on time or early,” Azam said.

“For example, the 2002, 2006 and 2011 bonds are all paid off completely. We are on schedule to pay off the 2018 bonds early. The 2023 bonds for our high school project are still in the works. But we anticipate paying them off early as well, saving the taxpayers even more money. We know how to watch the values to our advantage so that we can utilize bonds, keep taxes low and provide great facilities, transportation and technology, etc. for our faculty, staff and students,” he added.

In 2008-09, AISD’s rate was $1.20 per $100 valuation. It has dropped nearly 40 cents since then.

“It’s a little frustrating when the state is sitting on tons of surplus money and won’t free it up to schools. We’ve had 30, 40 cents less to work with on our tax base then they won’t free up money to give it to us to hire teachers. … The state continues to require us to do more with less funding,” Azam said.