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Budget Basics


Welcome to Liberty Hill ISD's Budget Basics page, designed to provide our community with clear insights into school finance, helping you better understand and navigate the financial aspects of education.

  • Develop a deeper understanding of how school districts are funded in Texas.
  • Gather information about LHISD’s current budget outlook.
  • Stay informed about upcoming community decisions that will impact you.


Here, you will find an overview of how districts are funded and where the money goes; definitions of key concepts and common acronyms; and frequently asked questions.

Budget Basics - Money Matters

Where does the money come from?

Public schools in the state of Texas are funded from three main sources: local school district property taxes, state funds, and federal funds, with the majority of funding coming from local property taxes collected by school districts and state funds.

Local/Other: Property taxes paid by homeowners (61%) and businesses (3%) make up the majority of the revenue LHISD receives or about 64% of LHISD’s operating budget revenue. Property values are determined by the Williamson County Appraisal District (WCAD). 

State: Texas school districts receive funding from the Texas Education Agency (TEA) based primarily on student attendance. State revenue makes up the difference between total revenue earned and local tax revenue. About 35% of LHISD’s operating budget revenue comes from the state, but the state’s share has been decreasing due to LHISD’s increasing property values. The funding formula is set in stone. 

Federal: Federal revenues are directed toward reimbursements only and make up only 1% of the operating budget revenue. 

Where does the money come from? 64% comes from local and other sources, 35% comes from the state,. and 1% comes from federal sources.

Taxes and School funds

This creates a relationship between local and state funds where when local tax collections increase, state funds to a school district decrease.

School Taxes by the Glass

Local property taxes fill the glass first, and the state fills in any space that is left. 


In an area like Liberty Hill ISD where home values are rapidly increasing, even when the tax rate stays the same or is lowered, homeowners will likely see an increase in the total amount of taxes owed due to the higher property values.

School taxers by the glass. Local property taxes fill the glass first, and the state fills in any space that is left.

How is the money budgeted?

How is the money budgeted? 85% goes towards salaries and benefits, and 15% goes towards campuses and departments.

The general fund accounts for the district’s operating budget and supports the district's daily operations and is broken down into the following main funding areas:

Salaries & Benefits: The bulk of the fund, approximately 85%, is dedicated to Salaries & Benefits, ensuring the compensation of educators and staff members.

Campuses & Departments: The remaining 15% is allocated to Campuses & Departments, supporting various operational needs across schools and administrative units within the district.

Like the average household, LHISD is facing rising costs in fuel (11% increase), utilities (31% increase), and insurance (74% increase), mirroring broader economic trends. These increases necessitate careful budget management and exploration of cost-saving measures to maintain financial stability.