Acronyms & Definitions

All Texas school districts are entitled, under the Texas Constitution, to receive a designated amount from the state of Texas' Permanent School Fund. ASF distributions go toward a district's Tier 1 Entitlement and are based on the district’s prior year average daily attendance (ADA).

Average Daily Attendance (ADA) is the number of students in average daily attendance or the sum of attendance for each day of the minimum number of days of instruction.

The Basic Allotment (BA) is set by the Texas legislature, guaranteeing every school district a certain amount of funding for each student based on the Average Daily Attendance (ADA). The BA is currently set at $6,215, with additional funding depending on district and student characteristics.

A portion of the tax rate that brings in revenue above the Tier 1 Entitlement and can generate additional state aid but is subject to Recapture.

Expenses or spending within a governmental entity – like a school district – are referred to as expenditures. Expenditures represent the spending of money.

A fund balance is like a savings account or emergency account that includes money that school districts do not allocate in budgets and hold in reserve. Fund balance is generated when annual revenues exceed actual operating costs. These funds are used to manage fluctuations in cash flow and to cover unforeseen expenses.

A portion of the tax rate that brings in revenue above the Tier 1 Entitlement and is not subject to Recapture, meaning 100 percent of the revenue generated from this part of the tax rate stays in the district. They are referred to as “golden” because of their high value to a school district and because State aid can be generated to fully fund the calculated entitlement.

House Bill 3 is a bill passed by the 2019 Texas Legislature.

The Interest and Sinking (I&S) part of the tax rate. Dollars from this portion of the rate can only be used to pay down existing debt. These tax collections cannot be used for operations, such as increasing teacher salaries or to build facilities.

The Maintenance and Operations (M&O) part of the tax rate. Dollars from this portion of the rate are used toward expenses like payroll, utilities, supplies and transportation.

The income of a governmental entity – like a school district – received from taxation and other local, state and federal sources. Revenues are used to finance the services provided to its citizens.

Weighted Average Daily Attendance (WADA) is an adjusted student count taking into account student and district characteristics by which students in certain programs are “weighted” to generate additional funds.