Lancium's potential impact on AISD: Taxpayers could see reduction due to 'eye-popping' numbers
ABILENE, Texas () – The Lancium Campus, part of the Stargate Project, is projected to bring revenue into the county and Abilene Independent School District Superintendent Dr. John Kuhn says the school district could also benefit.
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'The estimates that I've seen and the things that I heard talked about on a federal level really are pretty eye-popping numbers as far as the eventual value of that project,' Kuhn said.
The project's tax will go toward the AISD's interest and sinking fund, which repays voter-approved bonds for major capital improvements. However, Texas law prevents the district's maintenance and operations budget from benefiting directly from the artificial intelligence (AI) infrastructure.
Kuhn stated that the anticipated financial impact could significantly alter the situation.
'Any type of massive project like this is going to have a positive impact on the school district's ability to especially raise funds through bond elections, which is how we construct facilities, new schools, and things like that,' Kuhn explained.
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The district has already initiated internal discussions regarding the potential next steps. Various options are being considered to address the community's future needs.
'We, at some point, do need to figure out a way to make some physical improvements, particularly to our secondary schools, our high schools especially, but also our middle schools. Those types of improvements require money that we currently don't have, so a future bond election would be a consideration for sure,' Kuhn said.
The potential benefits not only extend to the school district, but also to local homeowners who stand to gain.
'In the short term, as this project comes online, it will save taxpayers money because it will reduce the tax burden on residential homeowners. Because the Lancium project has such high value in it, they will be paying school taxes,' Kuhn said.
As for when the district could start seeing those financial benefits, Kuhn says that remains to be seen.
'Informally, I've heard that the idea is to ramp up this project really, really quickly. We feel like we're going to see immediate increases to our tax base because there are already structures going up right now,' Kuhn said.
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Kuhn also provided a statement that offers additional insights into this revenue.
EDITORS NOTE: Any estimates included in the statement below are based on the partial and unverified information that Kuhn has seen regarding the potential total project value of Lancium and should not be interpreted as guarantees.
In the old days, when a multi-billion dollar project like Lancium arrived in a school district, the school district essentially won a lottery and would be flush with cash for maintenance and operations (M &O), which is the main portion of ISD costs. (M&O is used for everything from staff salaries and benefits to bus fuel to paying the electric bill.)
A famous example of this olden-days windfall is Glen Rose ISD when the nuclear power plant was built there. The district's budgeted revenue rose greatly because of that project's impact on taxable value in the ISD.
Unfortunately for Abilene ISD right now, such a windfall on the M&O side is no longer possible.
Here's why: starting in or around 2005, the Texas legislature changed school funding formulas so that ISDs are locked into a funding reality where local revenue and state assistance are combined to create a fixed total funding level. As a result of this change, when local tax receipts rise due to a massive increase in local property value, the state of Texas reduces the level of state-provided funding directed to the ISD. The district's total M&O revenue remains static. When local revenues rise, state revenues fall by the same amount.
Nevertheless, even though the Lancium project won't result in a windfall for AISD on the maintenance and operations side, it will still greatly benefit AISD.
There is a second side of our tax rate that isn't the maintenance and operations (M&O) side. It's called Interest and Sinking (I&S). This is the portion of local school taxes used to repay voter-approved bonds that fund major capital improvements, like the LIFT.
The current total AISD tax rate is $0.9924 per $100 valuation. (This means that for every $100 of value of a property, the property owner pays a bit over 99 cents on school taxes.) Of that total, $0.689 per $100 valuation is for maintenance and operations (M&O) and $0.3034 per $100 valuation is for interest and sinking (I&S).
(You can find our historical tax rates here: https://www.abileneisd.org/o/aisd/page/financial-services)
The Lancium project can help AISD in two big ways.
First, the I&S tax rate that must be levied to cover bond payments will fall significantly as the full value of the project comes online. The school district did not abate the property taxes for this project, so the business entity will have to pay full school taxes. As a result of this, the property value is so high that it will cover a large portion of the I&S revenue needs.
In other words, the portion of I&S taxes paid by residential homeowners and non-Lancium business owners will drop as Lancium pays its very large share. This project will almost certainly reduce AISD taxpayers' school taxes by a nontrivial amount.
In fact, based on early estimates of the maximum value of the project, it is possible that the school taxes on an average home in AISD could decrease by over $100 per year when the Lancium project reaches its full valuation. (Note that this is based on valuation estimates I've seen in the media and should not be taken by anyone as a guarantee, as those values are not at all official.)
The second major way this project can benefit AISD is, put simply, it can create enough bond capacity to allow us to finally address our aging facilities, especially our high schools.
Our current I&S rate is just over 30 cents per $100 valuation. The statutory maximum rate that an ISD can set for I&S is 50 cents per $100 valuation.
This means there is an absolute limit on the number of dollars an AISD bond can possibly generate. When valuation rises significantly (as it will as a result of the Lancium project), the absolute limit on dollars that can be generated also rises.
Right now, AISD cannot generate enough I&S revenue—even if we were to max out our I&S rate to 50 cents per $100 valuation—to build a single state-of-art-high school…much less two.
The Lancium project changes that calculus dramatically.
Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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