The board of trustees approved a nearly $7 million increase to its projected budget shortfall, which now sits at almost $29 million, at a Nov. 21 meeting. The budget amendment comes as LISD is receiving less state revenue due to lower student enrollment, Chief Financial Officer Pete Pape said.
The breakdown
Leander ISD is expected to see a $4.9 million reduction in revenue alongside a $2 million increase in expenditures, resulting in an almost $7 million increase to its projected budget shortfall for FY 2024-25.
Recent changes to the budget include:
- A decrease of $4.48 million in state revenue due to enrollment being lower than projected
- A decrease of $468,746 in local revenue due to certified property values being lower than preliminary estimates
- An increase of $194,489 in recapture due to lower enrollment
- An increase of $1.84 million for start up costs for the new LISD Police Department
A closer look
Amid lower enrollment, LISD is expected to receive less state revenue as districts are funded based on the average number of students that attend school each day. Additionally, LISD may be required to send more of its local property tax revenue to the state through a process known as recapture.
The $1.84 million in startup costs for LISD’s new police department will go toward vehicles, uniforms, body cameras, radios, firearms, ammunition and batons, Pape said. The district is projected to incur $2 million in overall startup costs and $4.8 million in ongoing costs each year to fund the department.
The district is starting the department to comply with House Bill 3—a new state law that has required districts to have an armed security guard at each campus since Sept. 1, 2023.
The backstory
The district adopted its FY 2024-25 budget in June with a $13.09 million shortfall amid several cuts to state and federal funding. The $460.36 million general operating budget included a 2.5% compensation increase for all staff totaling $8.13 million.
The board of trustees has since approved several amendments to the budget, including a $5.5 million expense to provide one-time payments of $1,000 to staff members. At that time, Pape said LISD had a fund balance of $185 million.
In case you missed it
After years of fast growth, LISD’s enrollment is projected to increase at a slower rate over the next decade.
In October, the district’s enrollment of 42,537 students was lower than last school year as well as prior projections for the 2024-25 school year, according to a demographic study by Population and Survey Analysts. In recent years, more students are attending charter schools and other educational options, while smaller kindergarten classes are entering the district, according to the report.
Amid the decelerated growth, LISD is considering opening enrollment to students living outside of the district’s boundaries.
Looking ahead
The district will provide an update on its budget to the board of trustees in January, Pape said.
The FY 2024-25 budget shortfall is projected to decrease as it has historically done so in years past, he said.
