JISD’s original budget shortfall of nearly $36 million was offset by the use of disaster pennies, bringing the shortfall closer to $24 million.
SCUCISD approved a budget with a nearly $11 million shortfall in the general fund and around $4 million shortfall in additional budgets.
Keeping wages competitive, keeping up with rising costs and retaining employees remains challenging, SCUCISD Finance Director Brian Moy said.
“The single biggest [budget] that increased is our expenditures for teachers, and our pay raise,” Moy said.
Current Situation
If districts cannot find a way to reduce budgets further, budgets might dip below the required fund balance of 90 days of operating costs, which Moy said could occur by fiscal year 2026-27.
This means that districts would need to make essential cuts in order to sustain mandatory services for students and staff.
Despite passing budgets with shortfalls, districts are increasing employee salaries and incentives to stay competitive and promote employee retention.
Judson ISD
During a budget presentation on June 25, JISD staff said the revenues in the FY 2024-25 budget were estimated at around $236 million with total expenses around $272 million, with a shortfall of around $36 million.
With the approval of disaster pennies, which leverage a tax rate as a way to increase revenue, the total revenue was increased to around $248 million, reducing the shortfall to around $24 million.
The disaster pennies will raise additional funds through an increase in the maintenance and operations, or M&O, tax rate. This strategy avoids an increase in the tax rate to taxpayers.
On Aug. 15, Superintendent Milton “Rob” Fields III explained that throughout the year, budget amendments will be approved due to unexpected costs related to equipment or other emergencies.
Any further budget cuts would be to essential services, Fields said.
“It is not cutting fat anymore,” Fields said. “There is no fat in the budget. It is muscle, so that means we are going to have to do away with something that we felt like we thought we had to have before.”
Schertz-Cibolo-Universal City ISD
For SCUCISD, Moy explained that the $11 million shortfall in the general fund will most likely not be the actual deficit by the end of the fiscal year. This is the largest approved shortfall by the district in the past five budget cycles.
Moy said he expects that the actual deficit will be much less.
“We don’t spend every dollar that we allocate,” Moy said. “We will still be well above our ending fund balance targets at the end of the year.”
Board President Ed Finley on Aug. 8 said the district will run out of money without some sort of support from legislation.
“Even a conservative district will eventually run out if they don’t help us in Austin,” Finley said.
What’s being done
While districts are struggling with lean budgets, they continue to increase employee salaries to stay competitive in hopes of filling vacancies and retaining employees.
JISD approved a 1% increase for teachers, librarians, nurses and counselors, keeping their starting salary at the highest compared to surrounding districts.
SCUCISD also approved raises for staff, giving 3% across the board. This raise alongside changes to benefits results in around $3.5 million in additional budget expenditures. Other districts are trying different approaches to teacher and staff retention.
North East ISD for instance opted to instead offer one-time supplement payments for employees rather than adding pay raises, which would cost more, according to NEISD documents.
Managing the impact
Declining enrollment and increasing costs per student is becoming untenable as well, as each district loses state funding when students move or increasingly opt for schooling alternatives.
State funding is calculated through a district’s average daily attendance. That per student allotment—$6,160—has not increased since 2019. Based on an enrollment of 14,865, SCUCISD spends around $10,974 per student. JISD spends around $11,200 per student, and the district’s current enrollment is 25,871.
“Each one of those kids has a state revenue attached to them, so we lose state revenue when they leave,” Moy said.
Going forward
Moy said SCUCISD has not yet discussed the specific details of budget cuts, but the first areas to be looked at are positions that are not campus related, should that need arise.
SCUCISD Superintendent Paige Meloni said that the district has programs and services such as software licenses that can be cut, but around 85% of the budget is compensation. Extracurricular activities and non mandatory programs are also looked at when cuts are the only option for districts.
Ultimately, districts will have to work on a plan moving forward to continue to support students and staff while making possible cuts to upcoming budgets if there are no changes to funding.
“We have a year now to work on bringing forward some things that we can do not only during the year, but then moving forward for the next budget cycle,” Judson ISD trustee Suzanne Kenoyer said on June 25.
