As families across Texas settle back into school routines, classrooms look and feel much like they always have. Yet behind the scenes, public school leaders are navigating changes that could shape public education for years to come.

Texas public schools are entering a pivotal year as districts implement major policy shifts passed during the 89th legislative session while navigating funding pressures and declining enrollment.

“For Texas school districts, it's going to be about managing several critical, overlapping transitions over the next handful of school years,” said Bob Popinski, dean of policy for Raise Your Hand Texas. “School boards and administrators are doing significant work behind the scenes right now—work that won’t necessarily be obvious to parents dropping their kids off on the first day, but will fundamentally impact their neighborhood schools over time.”

Understanding these changes provides context for the decisions school boards are making today and how they could shape the future of public education across Texas.

The challenge facing school funding

Across Texas, school boards are making difficult budget decisions this year, including adopting deficit budgets, freezing hiring, reducing programs and consolidating campuses. While each district's situation is different, many are facing the same financial pressures.

The 89th Texas Legislature approved House Bill 2, an $8.5 billion investment in public education that included funding for teacher pay raises, special education, campus safety and a new operational cost allotment to help districts cover rising expenses such as insurance, utilities and transportation.

Even with that investment, many districts continue to face financial strain. According to Raise Your Hand Texas, the state's basic allotment has not kept pace with inflation, leaving districts needing roughly $1,300 to $1,400 more per student just to restore purchasing power to pre-inflation levels. Much of the new funding is helping districts cover rising costs rather than expand programs or services.

Compounding this inflation gap is the reality of student enrollment. Roughly 5.4 million students are returning to Texas public schools this fall—about 76,000 fewer than last year—reflecting lower birth rates and shifting demographic trends. 

"Texas is unique in that we fund schools based on attendance rather than enrollment, so when a district loses students, the funding loss happens immediately, but many of the costs do not," Popinski said. "A district can lose 100 students and lose about $1 million in revenue, but the cost of operating a bus route, maintaining a building or staffing a classroom doesn't disappear overnight."

Together, those pressures are forcing districts to evaluate staffing, programs and, in some cases, whether schools should remain open.

Can Texas school finances support the future?

One of the biggest challenges facing Texas school districts is the disconnect between state budgeting and district operations.

While Texas adopts a new budget every two years, districts must make long-term decisions about staffing, facilities and academic programs. When funding fails to keep pace with inflation or enrollment changes, districts often shift focus from future priorities to immediate needs.

“When you look at kindergartners entering school this fall who won't graduate until 2039, operating on a two-year state budget cycle means having to pause every two years to question if the funding will be there for them,” Channelview ISD Superintendent Dr. Tory Hill said. “Having predictable, long-term financial clarity gives school districts the stability to plan five, 10 and 15 years down the road rather than questioning our resources cycle to cycle.”

To address those challenges, Raise Your Hand Texas advocates for the Legacy Education Fund, a new, permanent public education and workforce endowment.

Rather than relying solely on legislative appropriations every two years, the proposal could use a portion of the Economic Stabilization Fund, commonly known as the Rainy Day Fund, to create an investment that generates ongoing revenue for public schools. The funds could also come from:

  • State general revenue, which the Legislature can allocate to strengthen the endowment.

  • A dedicated share of sales tax growth.

  • State savings due to local school district value growth, directing part of the reduced state share of school finance into the endowment.

“The Legacy Education Fund is about thinking 10, 15 and 20 years down the road,” Popinski said. “By creating a new permanent endowment, Texas can give school districts the certainty they need to retain top teaching talent, maintain facilities and ensure every child has access to a quality education, regardless of what the broader economy is doing.”

This school year, districts are also preparing for one of the biggest shifts in Texas education policy in recent years.

During the 89th legislative session, lawmakers approved Senate Bill 2, creating the Texas Education Freedom Accounts program, the state’s first universal education savings account program. The program provides state-funded allotments for families to use toward private school tuition and other approved educational expenses—roughly $10,330 per student and up to $30,000 for students with disabilities.

Supporters say ESAs expand educational choice by giving families more flexibility in where and how their children learn. Public school leaders and advocates, including Raise Your Hand Texas, say the program also raises questions about public accountability and school funding.

Unlike public school districts, private schools and participating vendors are not subject to the same state accountability systems or public reporting requirements. Additionally, students with special education needs who use an ESA to attend a private school may no longer receive the same protections and guaranteed accommodations available under the Individuals with Disabilities Education Act.

“Public tax dollars should carry public transparency,” said Popinski. “Ensuring our public schools are fully supported is the only way to protect educational opportunity for all 5.4 million Texas students.”

As districts implement the new program, local leaders will continue balancing enrollment changes, financial pressures and the responsibility of serving every student in their communities.

School staff member in a Wildcats shirt with ID lanyard and radio stands beside yellow school buses as students gather.

How is STAAR changing in Texas? 

Today, more than 80% of Texas public schools—including every elementary and middle school campus—receive their A-F accountability ratings based solely on student performance on the State of Texas Assessments of Academic Readiness (STAAR) exam. Students typically take STAAR assessments near the end of the school year, but districts often do not receive final results until weeks or months later, limiting educators’ ability to use that information to provide immediate support.

“I often describe STAAR as an autopsy: when we get that data back months later, there is nothing left we can do to immediately support that student,” Hill said. “Assessments should operate more like physical exams, giving educators real-time checkpoints throughout the year so we can intervene and support students right when they need it.”

In response to those concerns, lawmakers passed House Bill 8 (HB 8), creating the Student Success Tool, which is scheduled to launch in the 2027-28 school year. The new framework replaces a single end-of-year exam with multiple assessments throughout the school year, giving educators more timely data to guide instruction.

Under HB 8, district accountability ratings will still be based on results from the end-of-year assessment. Those ratings continue to carry significant consequences, as repeated low scores can trigger state intervention, including state takeovers that replace locally elected school boards with state-appointed leadership.

While the testing model is changing, accountability will remain central to how schools are evaluated, meaning district leaders must continue balancing state requirements with their broader mission of preparing students for success beyond the classroom.

How Texas curriculum is changing

Beyond funding, accountability and enrollment, Texas school districts are also preparing for long-term changes to classroom instruction.

House Bill 1605 reshapes how instructional materials are reviewed, funded and adopted across the state. A key component of the law is Bluebonnet Learning, a series of state-developed instructional materials aligned with Texas academic standards and reviewed by the State Board of Education. The materials emphasize foundational literacy, phonics, and grade-level instruction in core subjects such as reading and mathematics.

To encourage adoption, the state offers districts an additional $40 per student for using state-approved materials, along with up to $20 per student to help cover printing and shipping costs. The law also includes optional resources, such as parent access portals and pre-written lesson plans designed to support teachers.

Full implementation will occur through a gradual transition, giving districts time to evaluate materials, train educators and determine what best fits their classrooms.

“The transition to new state-developed curriculum frameworks is a gradual process that extends through the 2030-31 school year,” Popinski said. “While state-approved materials and additional funding offer helpful options for districts, local school boards maintain the ultimate authority to choose what best fits their classrooms.”

How Texans can stay informed

While many education policy decisions begin at the Texas Capitol, their impact is felt in neighborhood classrooms and communities across the state. As districts navigate changes, staying informed can help parents, taxpayers and community members better understand the decisions shaping their local schools.

“Public schools are the foundation of our communities, and their long-term success relies on informed, engaged local voices,” Popinski said. 

Texans can stay engaged by:

As Texas public schools navigate this period of change, informed community engagement will remain an important part of shaping the future of education across the state. 

The above story was produced by Multi-Platform Journalist Chloe Chapel, with the Community Impact's Storytelling team, using information solely provided by the local business as part of their "sponsored content" purchase through our advertising team.

What is Raise Your Hand Texas?

Raise Your Hand Texas is a public education advocacy organization based in Austin, Texas. Founded in 2006, its mission is to advance public education in Texas by engaging in advocacy efforts, developing educational leadership and supporting impactful public education policies. Raise Your Hand Texas is a critical player in educational reform across the state, advancing the education of 5.4 million students in Texas public schools through research, advocacy and direct public policy interventions.

The organization focuses on two core issues that affect every Texas student, educator, and campus: school funding and the assessment and accountability system.

Why are local school districts facing budget shortfalls despite new state funding?

While House Bill 2 provided $8.5 billion in state investments for public education, funding has not kept pace with multi-year inflation. Additionally, Texas funds schools based on Average Daily Attendance rather than total enrollment. When student attendance drops, districts lose state revenue immediately, even though fixed costs like utilities, building maintenance and staffing remain the same.

How is the STAAR test changing with the Student Success Tool?

Under House Bill 8, the state is transitioning to the Student Success Tool starting in the 2027-28 school year. This framework replaces a single, end-of-year STAAR exam with multiple assessment checkpoints throughout the year, giving educators real-time data to adjust instruction and support student needs before the school year ends.

How do Education Savings Accounts (ESAs) impact public school budgets?

Senate Bill 2 created state-funded allotments for families to use toward private school tuition or alternative educational expenses. When students leave public school districts to participate in the ESA program, the public school district loses the state funding attached to those students' attendance, creating additional budget pressures for local neighborhood schools.