Austin ISD weighs $117M-plus in cuts as budget shortfall climbs to $181M

To reduce expenses, district officials discussed four scenarios that could involve making anywhere from $117 million-$132 million in budget cuts. Additionally, the district may save $9 million-$10 million by removing vacant positions and receive $50 million from monetizing three district properties, Chief Financial Officer Katrina Montgomery said.

The proposed strategies could lower the projected budget shortfall from $181 million to $4 million or produce a $9 million-$11 million surplus. The cuts could include letting go of current staff members and eliminating stipends, Segura said.

"The pressures right now and the budget that we have simply does not pay for what we're currently offering," Segura said.

How we got here

After making budget cuts, the district’s projected budget shortfall for FY 2025-26 has increased from $19.7 million to $49 million. Since adopting its budget in June, the district has seen property values decline and received additional budget requests from departments, Montgomery said.

Amid ongoing litigation and community pushback, AISD will no longer receive revenue from a $26 million land sale this fiscal year, Montgomery said. AISD has proposed selling the former Rosedale School to OHT Partners—a multifamily housing developer, which has plans to build a six-story apartment complex.

AISD's enrollment has declined by more than 17% over the past decade, according to Texas Education Agency data. AISD lost nearly 3,200 students from last school year to this school year—the district's largest decline in enrollment since the 2020-21 school year during the COVID-19 pandemic.

"We had seen changes in years past tied to federal changes in immigration," Segura said about declining enrollment. "What's different this time is families are leaving and no new families are coming."

Next school year, the district will close 10 campuses to remove thousands of vacant student seats and save around $20 million in expenses. The school closures are one of many steps needed to improve the district's budget situation, Segura said.

Amid the budget cuts, AISD will pour nearly $20 million in additional academic resources into 24 struggling campuses or campuses that are merging with a low-performing school. This heightened intervention, known as a turnaround plan, is required when a public school receives two or more unacceptable accountability ratings from the state.

Learn more

District officials will share its preliminary FY 2026-27 budget April 23 and present budget reductions May 7, according to district documents

AISD will host meetings to discuss its budget with families, staff and community members on the following dates:

• April 25, virtually from 11 a.m.-noon
• April 28, from 6-7 p.m. at Austin High School
• May 9, virtually from 11 a.m.-noon