Plano ISD to face operating budget deficit in 2019-20 academic year despite new state funding formulas

Plano ISD officials discussed the district's 2019-20 budget at a June 25 meeting.

Plano ISD officials discussed the district's 2019-20 budget at a June 25 meeting.

Plano ISD officials project the district will face a deficit in its operating budget for the 2019-20 school year despite recent sweeping changes to the state’s public school funding formulas.

Under the state’s previous funding formulas, the district projected a $33.6 million operating budget shortfall for the 2019-20 school year. After Texas Gov. Greg Abbott signed House Bill 3 into law on June 11, the district now projects it will face an $18 million shortfall.

Among a slew of provisions, House Bill 3 includes new money for teacher raises and full day pre-kindergarten, as well as the compression of school districts’ property tax rates.

PISD Chief Financial Officer Randy McDowell said the district did not benefit from House Bill 3 as much as others in the state.

"When you put all the money in the pot and reshuffle it, districts like us didn’t fare very well,” McDowell said at a June 25 board meeting.

Superintendent Sara Bonser said the district committed to providing increases to employee compensations and benefits packages beyond what is mandated in House Bill 3.

“The result [of HB3] is that there was a lot more money put into public education in the state of Texas,” Bonser said. “But when the formulas come out, the impact on Plano ISD, as you see, is about an $18 million difference for us, and half of that is going to employee compensation and benefits.”

Along with the 2019-20 budget, the board of trustees approved the district’s new compensation package at the June 25 meeting. The package includes a 2.5% pay increase for teachers, nurses, counselors and librarians with less than six years of experience. Individuals in the same cohort with six or more years of experience will receive a 3% pay increase.

Starting salaries for new teachers with no experience are now $54,000 for those with bachelor's degrees and $56,000 for those with master's degrees.

Because the budget was initially calculated using the state’s previous funding formulas, the district will amend its budget with the updated figures in the coming months, McDowell said.

PISD projects it will send $171.5 million to the state in the form of recapture payments in 2019-20. Recapture, also referred to as Robin Hood, is a finance tool in which the state redistributes tax revenue from property-wealthy school districts to property-poor school districts. The district would have sent an estimated $255.1 million in recapture payments under the previous funding formulas.

Correction: A previous version of this story incorrectly stated salary rates for new employees. In fact, the new rates only apply to new teachers.
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