The El Paso Independent School District board approved a tax rate Tuesday that would raise the tax bill on an average home by about $114 a year compared to last year, although a third of homeowners in the district will pay nothing in school tax.

The El Paso ISD board voted 7-0 to adopt a tax rate of $1.0745 per $100 of taxable property valuation. This is slightly below the voter-approval rate of $1.0789 per $100 property valuation, which is the highest tax rate the district could adopt without triggering an election.

District officials said the tax rate is primarily driven by complex state school finance law, leaving EPISD with little discretion on the rate. As the state has increased homestead exemptions for school property taxes in recent years, the law also created calculations for what is known as “compression,” or a reduction in tax rates, EPISD Treasurer Walt Byers told the school board.

“So our property tax collections have been decreasing every year because of the compression and also because the increase in the homestead exemption from $40 (thousand) to $100 (thousand) to $140 (thousand) now, the homestead exemption plus the exemptions for over 65, disabled, those have increased, and for that reason, our property (tax) collections have decreased,” Byers said.

The state has provided additional aid over the years through a “hold harmless” provision meant to offset property tax revenue lost to increased exemptions. However, school officials in El Paso and elsewhere have criticized the calculations the state used this year. 

The new rate will generate $13,389 in local and state revenue per student, district officials said. That’s $396 per student more than the district would generate if it adopted the no-new-revenue rate of $1.0233 per $100 valuation – the rate needed to generate the same tax revenue as the prior year on the same properties.

In the 2025-26 school year, El Paso ISD generated $13,572 per student through a tax rate of $1.08 per $100 of taxable property value. The district, which has seen enrollment declines for more than a decade, has just over 44,000 students this year.

The impact of the tax rate on individual property owners will vary by circumstances.

For most homeowners, the first $140,000 of their property value is exempt from school taxes under the Texas Constitution; people age 65 and older, or people with disabilities, get an additional $60,000 exemption. Veterans with a 100% disability rating are exempt from all property taxes in Texas.

In addition to the $60,000 additional exemption, people over age 65 cannot have their school tax bill increased.

Homes valued at more than $200,000 that saw an increase in valuation this year likely will see an increase on their school tax bill if the owner is younger than 65.

State law requires governments to estimate the tax impact on an average value home. For El Paso ISD, the average home has a taxable value after exemptions of $120,455 this year, up from $109,167 in 2025.

Using those values, the El Paso ISD tax on an average value home this year would be $1,294 – up from $1,180 a year ago.

Commercial properties and rental homes generally have no exemptions under Texas law.

More than 20,000 of the 57,630 El Paso ISD homes occupied by their owners will pay no property tax this year because their exemptions are higher than the taxable value of their homes, according to the El Paso Central Appraisal District.

EPISD is the last of the major El Paso area governments to adopt a tax rate for the current year.

The EPISD board last month decided to postpone a nearly half-a-billion-dollar bond proposal election that, if approved, would have allowed the district to maintain the same tax rate as last year. The bond of up to $445 million bond would be used to upgrade the cooling systems on its campuses to refrigerated air and other needed improvements throughout the district.

EPISD plans to hold a bond election in May 2027.

Socorro and Ysleta ISDs will have elections in November seeking permission to raise the tax rate above the amount permissible without voter authorization.