The district has proposed making $37.5 million in budget cuts in fiscal year 2025-26, according to information presented by interim Chief Financial Officer Katrina Montgomery at a June 12 meeting. The board of trustees is set to vote on adopting AISD’s budget at its June 26 meeting.
Current situation
AISD is projecting a $93 million budget shortfall in fiscal year 2024-25 and a $127 million budget shortfall for FY 2025-26.
Amid the growing budget shortfalls, AISD is projected to deplete its fund balance by 2027, according to an AISD presentation. A district's fund balance is the amount of revenue it keeps in its reserves.
“Even though we've made a lot of strategies and a lot of work, there’s still a lot of work that we need to do to move forward to make sure that our district is [as] stable as possible,” Montgomery said.
The update
For FY 2025-26, AISD has proposed cutting around $37.5 million from its budget, including:
- $15.5 million in forced reductions to schools and central office departments
- $10 million to restructure central office positions
- $9 million in special education-related cuts
- $2.5 million in master scheduling efficiencies, meaning bell schedules
- $500,000 in supplementary programs
“Some of these things are fully baked and some of these things we still have a lot of work to do,” Montgomery said about the proposed budget cuts. “These are things that the district administration is committed to making sure that happens.”
Diving in deeper
Superintendent Matias Segura could choose to implement forced budget reductions across district campuses and departments, Montgomery said.
AISD will restructure its central office through eliminating positions, reassignments and new reporting structures. The number of executive positions in AISD has continued to increase despite its enrollment declining, Matias said in a letter posted on AISD’s website May 23.
Over the past year, the district has cut $63 million from its central office operations, including eliminating positions, cutting department budgets and reducing service contracts, according to AISD information.
“This is a very hard time for central office," Segura said at the June 12 meeting. “There are some things that we can't do moving forward. ... We cannot continue on with the same level of service and not expect to have a mass burnout. We're already lifting so much with so few resources.”
The district is expecting to receive $45 million in revenue from land sales. In April, AISD released the former Brooke Elementary School campus, which closed after the 2019-20 school year.
The district is looking to cut its property insurance expenses by up to 50%, or $3 million. Additionally, the proposed budget shows $15.3 million in savings from vacant positions.
Also of note
Under House Bill 2, AISD is anticipated to receive around $36 million in additional school funding, around $9 million of which may go toward offsetting the district’s budget shortfall, Montgomery said.
The $8.5 billion school funding legislation—signed by Gov. Greg Abbott June 4—includes a $55 increase to the basic allotment of funding per student as well as funding increases for special education, early education, school safety and support staff.
Although AISD is receiving an additional $551 in funding per student through HB 2, a $1,300 per student increase would’ve been required to account for inflation, said Jacob Reach, AISD chief of governmental relations and board services.
HB 2 allocates $2,500 raises for teachers with three to four years of experience and $5,000 raises for educators with more than five years of experience. The district is awaiting guidance from the Texas Education Agency on which staff members are eligible for the teacher raises, Reach said.
In case you missed it
To further reduce its budget shortfall, AISD is planning to begin closing and consolidating campuses beginning in the 2026-27 school year. Over the last 10 years, AISD’s enrollment has declined by more than 12,000 students, leaving the district with 25,000 empty seats, according to the TEA and AISD.
The district is seeking community input as it works to create a tool to evaluate its 116 campuses for potential consolidation. Community members can attend a virtual open house to learn more June 24 and 25.
AISD is expected to present its recommended campus consolidations to the board in October.
Next steps
AISD is expected to take the following steps related to its FY 2025-26 budget:
- June 18: notify central office staff of their employment status
- June 26: vote to adopt the budget
- Aug. 21: vote on the district's compensation plan
- Sept. 15: notify staff members receiving raises
