What a community can do with its own money

Every year, some of the money Smith County pays in taxes leaves as interest, and some sits in shared accounts. This page starts from those real numbers, then lays out how a community fund can grow, what it can own to lower what families pay, and how it stays honest — with a real example of each. Updated 2026-09-26.

The money that leaves — from the bond papers

Interest is the price of borrowing. It goes to bond investors. These are the amounts still due on Smith County’s bonds, from its own debt schedule.

Interest to lenders	Amount
New courthouse bonds — interest due from Oct 1, 2026 through 2048 $152,335,000 borrowed in 2023. Smith County FY2026-27 Budget (posted as “FY 2027 Proposed Budget”), p. 29	$97,450,900
Road and parking-garage bonds — interest due from Oct 1, 2026 Seven series, 2018–2025. Smith County FY2026-27 Budget (posted as “FY 2027 Proposed Budget”), pp. 27–30	$27,850,269

$125.3 million of interest is still to leave on bonds the county already owes — on top of about $33.7 million (estimated) already paid since 2018.

What we already pool — money that already exists

Shared money already exists here — in savings, and in a sales tax the county uses to hold down property taxes.

Where it sits	Amount
General Fund savings, Oct 1, 2026 (estimated) Smith County FY2026-27 Budget (posted as “FY 2027 Proposed Budget”), p. 21	$55,597,748
The county’s half-cent sales tax, FY27 (a year) Adopted to lower property taxes; the county’s worksheet counts it as replacing about 11.8¢ per $100. Smith County FY2026-27 Budget (posted as “FY 2027 Proposed Budget”), revenue detail p. 30	$30,000,000

The General Fund savings are the county’s cushion for emergencies and cash flow — not all of it is spare. The point is scale: the county already holds and pools tens of millions of dollars.

How a shared fund grows — without the stock market

Texas law keeps county money out of the stock market (government securities, bank deposits, and funds that hold only those). That’s fine — the biggest returns for a community fund come from somewhere else.

Way 1

Stop paying interest

The surest return is money that no longer leaves. Saving first, or borrowing for fewer years, keeps it here.

Alaska Permanent Fund. By law, Alaska may draw only 5% a year of the fund’s average value; the rest keeps growing. That draw now supplies over half of the state’s unrestricted general-fund revenue, plus a yearly dividend to residents ($1,000 in 2025). APFC · Alaska Dept. of Revenue

Here: From 2000, about $8.6 million a year in Treasury bills would have paid for the courthouse, parking garage, and road bonds in cash — about $224 million in all, against about $410 million by borrowing. See What if we saved?

The honest limit: Saving first means waiting, and asking taxpayers to pay before anything is built.

Way 2

Lend to ourselves

A community fund can lend to its own projects and charge itself interest. The interest comes back into the fund instead of leaving.

State revolving funds for water. Water and sewer loans are repaid with interest into the same fund, which lends it out again. Federal seed money of about $21 billion has turned into more than $41 billion of help this way (through 2019). EPA
Bank of North Dakota. Opened July 28, 1919 — the only state-owned bank in the nation. State money is deposited with it and lent back into the state. Bank of North Dakota

The honest limit: A revolving fund only works if loans get repaid.

Way 3

Own what lowers our bills

A fund that owns something useful “pays” its members as lower costs — power, internet, housing, food — instead of a dividend check.

Rural electric co-ops. Private power companies wouldn’t wire farms — too few customers per mile. Neighbors formed nonprofit co-ops, and the 1936 Rural Electrification Act lent them the money to build. NRECA — co-op history
Margins go back to members. A co-op returns what it doesn’t need as “capital credits.” Since 1990, electric co-ops have returned nearly $13 billion to their members. NRECA analysis
Chattanooga’s EPB. The city’s own electric utility launched the first community-wide gigabit fiber network in the U.S. in 2010. A University of Tennessee at Chattanooga study put the community benefit of the fiber network and its smart power grid at more than $5 billion since launch. UTC, Nov 2025
Champlain Housing Trust. Founded in 1984 with the City of Burlington, Vermont’s support, to keep homes permanently affordable — the land stays in the trust, so each home stays affordable for the next family. Champlain Housing Trust

The honest limit: Owning things means running them well: good management, repair reserves, and customers who stay.

How a shared fund stays honest

Elinor Ostrom won the 2009 Nobel Prize in economics “for her analysis of economic governance, especially the commons.” She studied shared resources that people ran well for generations, and found eight things they had in common:

Clear boundaries — who the fund belongs to, and what it’s for.
Rules that fit this place — written for local needs, not copied.
The people affected help make the rules.
Someone accountable checks — in the open.
Penalties start small and grow for repeat misuse.
Cheap, local ways to settle disputes.
Outside authorities respect the community’s right to run it.
For big shared resources, layers — local groups inside larger ones.

Nobel Prize · the eight principles

For a public fund, that means:

A written purpose, set before the money arrives.
A spending rule — like Alaska’s 5% a year — so the fund outlives any one board or election. APFC
Every deposit, loan, and payout on a public ledger anyone can check. This platform already keeps a hash-chained public record.
Residents decide the specific uses — a real, bounded pot, not a vote on the whole budget.

The warning: In 1994, Orange County, California’s treasurer borrowed against the county’s $7.6 billion investment pool to chase higher returns. It lost about $1.7 billion and the county filed for bankruptcy. A shared fund is safest when it is boring. SEC order

What the law allows today

Texas counties may invest only in government-type securities, bank deposits, and funds invested exclusively in those — not stocks. Texas Gov't Code §2256.014
Above its voter-approval rate, a county’s property tax rate goes to the voters in most cases. Texas Comptroller
Tyler is already at the state’s 2% cap on local sales tax, so no new sales tax can be added there. Texas Tax Code §323.101

Where residents come in

Put a use for shared money on the priorities board, and say why.
Watch what happens to it on What came of it — dated, cited, public.
Try the trade-offs yourself in the tax lab and on What if we saved?
Bring it to the body that decides — the calendar has the meetings.

What this doesn’t claim — the honest limits

Shared funds can be mismanaged, raided, or spent on the wrong things. The safeguards above exist because that happens.
A dollar saved is a dollar not spent on something people need now. Every choice here is a trade.
Examples from other places show what’s possible, not what will work here.
None of this is a recommendation. It is a map of options, with the record of each.

Related: What if we saved instead of borrowing? · Tax lab · The two pots (food) · Food sovereignty · Grow-ops. This page lays out options and their records; it doesn’t tell anyone what to choose. Spot an error? Report it.