When Dallas voters approved a record $6.2 billion school bond on May 2, 2026, the ballot they marked carried a blunt warning in capital letters: “THIS IS A PROPERTY TAX INCREASE.” Yet the district told voters the bond would raise the tax rate by only about a penny. Both statements were true — and understanding why is the key to understanding the half of your school-tax bill almost nobody talks about: the Interest & Sinking (I&S) rate.

Here is how school bonds actually reach your tax bill, why a bond can raise your taxes even while operating rates fall, and what is actually on the November 3, 2026 ballot now that the deadline to call an election has passed.

Your school tax has two separate halves

Every Texas school district sets its property-tax rate in two distinct pieces, and they pay for completely different things:

Maintenance & Operations (M&O) — the day-to-day cost of running schools: teacher salaries, utilities, buses, supplies. This is the rate the state has been compressing (pushing down) with its recent “tax relief” buydowns.
Interest & Sinking (I&S) — the money that repays voter-approved bonds: the long-term debt districts borrow to build and renovate campuses. It works like the mortgage on a house.

Add the two together and you get the district’s total rate. In Dallas County, for example, Dallas ISD’s total adopted school rate for 2025 was $0.9938 per $100 of taxable value (2025 Comptroller adopted rates). The critical thing to know: the state’s relief programs only push down the M&O side. They do nothing to the I&S side. Bonds are the part of your school bill that local voters — not the Legislature — control directly.

Bonds don’t come out of the operating budget — that’s the whole point

Texas law forbids school districts from using bond money for salaries or recurring operating costs. Bonds fund capital — buildings, land, technology, buses — and they are repaid over decades through the I&S rate. That separation is why a district can plead poverty on teacher pay in the same year it opens a new stadium: the two come from legally separate pots of money, funded by two different halves of your tax rate.

There is a hard ceiling on how far the I&S rate can climb. Before a district can issue new bonds, it must demonstrate to the Texas Attorney General that it can repay all its debt from an I&S rate of no more than $0.50 per $100 of valuation — the statutory “50-cent test” in Texas Education Code § 45.0031. A district that is already near that cap cannot simply keep borrowing.

Why the ballot always screams “PROPERTY TAX INCREASE”

Since a 2019 law (House Bill 3), every school-bond proposition in Texas must carry the exact phrase “THIS IS A PROPERTY TAX INCREASE” — in that wording, no softening allowed. The requirement lives in Texas Education Code § 45.003, and the Attorney General’s bond-counsel guidance is emphatic that districts may not modify, supplement, or qualify it.

Here is the twist that trips up almost every voter: the warning is mandatory regardless of what actually happens to your rate. It appears even when a district projects no rate change at all. So “THIS IS A PROPERTY TAX INCREASE” is a legal disclosure that the district is taking on new debt-repayment obligations — not a promise that your specific rate will rise this year.

How a bond can pass with “no rate increase”

Districts routinely tell voters a bond will have little or no effect on the I&S rate, and that can be genuinely true. The reason is the mortgage analogy again: as older bonds get paid off, the debt they were carrying rolls off the books, freeing up room under the I&S rate for new borrowing. A fast-growing district with rising property values can also spread the same rate across a larger tax base.

But “no rate increase” is not the same as “no tax increase.” If your home’s taxable value climbs, a flat I&S rate still produces a bigger I&S bill. And a rate that would otherwise have fallen as old debt retired is instead held up to service the new bonds — a real cost, just an invisible one. This is exactly the mechanism behind the school-tax rate votes we covered in 2025.

The 2026 bond wave — and the record in Dallas

May 2, 2026 brought one of the largest rounds of school-bond elections in Texas history, headlined by Dallas ISD. Voters approved a $6.2 billion package — the largest school bond ever put before Texas voters — passing by roughly a 3-to-1 margin, with every proposition clearing 70%. The biggest piece, Proposition A, was $5.9 billion for replacement campuses, technology, buses and more. It broke Dallas’s own prior record: a $3.5 billion package approved in 2020.

What did that record borrowing do to the I&S rate? According to the district’s Citizens Bond Steering Committee, the package was projected to raise the rate by about one cent per $100 — roughly $33 a year on a $500,000 home. A $6.2 billion “yes” and a one-penny rate change, on the same ballot that legally had to warn of a tax increase. That is the I&S system working exactly as designed.

Dallas was not alone. Smaller and fast-growing districts asked too — Ponder ISD in Denton County put a $304.99 million package on the same ballot (we were unable to independently verify Ponder’s final result as of this writing — check the Denton County elections office for the official canvass).

What is actually on the November 3 ballot

The speculation season is over. Under Texas Election Code § 3.005 a political subdivision cannot order an election later than the 78th day before election day, which for November 3, 2026 was Monday, August 17. Every district that is asking voters for anything this fall has already taken a recorded board vote. (We covered the tax-rate side of that ballot separately in what a VATRE actually asks you to approve.)

The clearest illustration of everything above is in Collin County. On August 11, 2026 the McKinney ISD board called a five-proposition election for November 3: Proposition A is a voter-approval tax rate election (VATRE) for teacher compensation and student programs, which the district projects would generate about $4.1 million a year after recapture. Propositions B through E are a $500 million bond covering safety and security, technology, facility upgrades and new schools.

Now apply the two halves. Propositions B–E are I&S — borrowed money repaid through the debt rate. Proposition A is M&O — the operating side the state has been compressing. They are on the same ballot and they fund legally separate pots.

And here is the part that trips people up: the district states that its total tax rate will still be 3.79 cents lower than last year, and that all five propositions fit inside that rate. The bond propositions will nevertheless carry “THIS IS A PROPERTY TAX INCREASE” on the ballot, because that warning is required by statute whenever the district issues debt — it is not a statement about which direction your rate is moving. A voter who reads only the capital letters, and a voter who reads only the district’s “lower rate” headline, both walk away with half the story.

Not every district went. On the same day, El Paso ISD trustees voted to postpone a bond election to May 2027 after its citizens bond committee recommended waiting, citing survey results that showed weak support for a package of roughly $445.8 million. A bond that is “coming” is not on a ballot until a board orders it.

To find out what your own district put on the ballot, ask the district for the order of election — it is a public record of the recorded vote — or check your county elections office. Early voting for this election runs October 19–30, 2026, and the last day to register is October 5 (Texas Secretary of State).

What to do before you vote — or pay

Read past the warning. “THIS IS A PROPERTY TAX INCREASE” is on every school bond by law. Look instead for the district’s stated I&S rate impact — that’s the number that tells you the likely cost.
Separate rate from bill. A flat rate on a higher appraisal is still a bigger check. Watch your appraised value as closely as the rate.
Find your own numbers. Look up your district’s adopted M&O and I&S rates on your county page — start with Dallas County or Collin County — and verify the current-year rate with your county appraisal district.
Track the calendar. School bonds appear on the May and November ballots, and a district must order the election 78 days ahead — so the field is set well before you see a mailer. The debt it authorizes can outlast the campus it builds, and the officials who proposed it.

Sources

How to Protest Your Taxes → Find Your County

How Texas School Bonds Set the I&S Half of Your Tax Bill