Saying they are preparing for an uncertain financial future, North East ISD trustees unanimously voted June 17 to approve a $772.1 million budget for fiscal year 2024-25.

The overview

The new budget is lower than the total $944.4 million budget the NEISD board adopted for FY 2023-24.

In the upcoming fiscal year, NEISD officials project $762.9 million in total revenues, including $543.2 million in local money and $178.5 million in state income. The new budget also features $612.3 million in general fund spending on daily maintenance and operations.

By comparison, in FY 2023-24, NEISD officials projected $890.4 million in total revenues, including $76 million in state money and $649.7 million in local income. The 2023-24 budget also featured $615.7 million in general fund spending on daily maintenance and operations.

The background

Over a series of recent school board meetings focused on developing the FY 2024-25 budget, district administrators said while there is a projected increase in state funding in the coming academic year, downward trends in student enrollment and average daily attendance, or ADA, are sparking worries about future funding allotments from the state.

In the 2023-24 school year, NEISD had an ADA—a major factor in the state's school funding formula—of 95% heading into the height of the COVID-19 pandemic.

NEISD has since struggled with enrollment, recording an ADA level of 93% toward end of the 2023-24 school year. NEISD ended the 2023-24 school year with a total student enrollment of 57,375, with district officials projecting a decrease to 55,882 in the 2024-25 school year.

District officials attributed the student enrollment reductions to challenges associated with class instruction during and after the height of the COVID-19 pandemic, and rising competition from charter schools and other alternative outlets of education.

Addressing other revenue sources, NEISD officials said increases in property appraisals will not boost district coffers given the relief provided to property taxpayers and the limitations imposed on public school districts in the 2023 Texas Legislature.

Sorting out details

NEISD officials said they are doing their best to rein in expenditures. The new budget contains $8.7 million in reduced spending through the elimination of 140 unfilled full-time teaching and other campus positions. Additionally, NEISD will cut 16 unfilled central office positions, totaling $4.7 million in savings.

District leaders said they also hoped to extend some type of pay raises to employees in FY 2024-25 like they did in the past three fiscal years.

However, concerns about student enrollment trends, inflation and potential inaction in the 2025 Texas Legislature prompted NEISD leaders to approve only a 1% retention supplement, which will be paid out only once this November to certain employees.

As a result of this retention stipend, NEISD’s general operational fund budget shortfall is projected to increase to $40.3 million.

What they’re saying

District employees voiced disappointment over there being no pay raises in the coming fiscal year. Patsy Esterline, North East American Federation of Teachers president, on June 10 told trustees her union proposed a $2,500 one-time stipend be provided by NEISD in lieu of salary hikes.

“Our request was to show where we should be in discussions for a competitive pay raise. We are aware of the financial challenges; nevertheless, the target should be there,” Esterline said.

Daniel Schroeder, an auto mechanic employed by NEISD, addressed the board June 10. He said he started working for NEISD in 2018 when the district had 17 mechanics and two tire technicians.

Schroeder said the district now employs 11 mechanics and one tire technician. He added that three mechanics are scheduled to retire within the next year.

Schroeder also said he and fellow mechanics are occasionally drafted to drive school buses because of a lingering shortage of full-time bus drivers. He encouraged district leadership to improve employee pay and labor shortages.

Some board members said one-time payments such as retention supplements are not guaranteed for a future offering, and they do not figure into the state’s formula for determining a teacher’s retirement funding.

On June 10, Superintendent Sean Maika said he understands the needs and wants of employees in financially tough times, but the district’s overall fiscal condition warrants an equal level of care and attention.

“This is probably the worst budget I've had to do as a superintendent because what I want to do and what we can do [for employees] are so vastly different,” he added.

What’s next

NEISD administrators said the board can approve a FY 2024-25 property tax rate in September after Bexar County’s newest property tax rolls are certified.