Both districts were able to balance their budgets thanks to increases in property taxes and adjustments to staffing as well as by limiting new programs.

Revenue challenges

Making up for the drop in state aid, the district adopted a $535.3 million budget in August for the 2016-17 school year, which is an increase over last year’s budget of $526.7 million.

Although KISD expects to receive $5.6 million more in state funds because of enrollment growth, it will lose more than $20 million due to tax revenue growth, resulting in an expected reduction of more than $15 million in net state aid in 2016-17 from last year.

KISD estimates an increase of $16.2 million in property tax revenue from last year with $269 million in projected revenue.

“The reduction in state aid based on the previous year’s growth will be made up by two primary factors,” said Thomas Petrek, associate superintendent of financial services. “They are property tax revenues from the current year based on growth in values, [and] growth in student [enrollment] provide additional state aid.”

KISD’s debt service rate is expected to increase this year because of the district’s $498.1 million bond referendum approved in 2015, which would result in a two-cent bump in the overall district tax rate to $1.43 per $100 valuation. KISD will vote in October on whether to adopt the tax rate.

SISD adopted a preliminary budget in June of $377 million, just under last year’s $378 million budget. The proposed tax rate would remain the same as last year’s rate of $1.47 per $100 valuation.

The district estimates an increase of $9 million in property tax revenue from last year but an overall decrease to $299 million in projected revenue from last year’s $312.3 million, due in part to a $21 million reduction in net state aid from last year because of the state funding formula, SISD Chief Financial Officer Ann Westbrooks said.

The district had a 7.5 percent increase in property values compared with last year, which led to the decrease in state revenue, she said.

“This causes a significant drop in total revenues because the additional property tax revenue is not keeping pace with the decrease in state revenue,” she said. “Student enrollment is projected to remain flat, which means we wouldn’t receive any additional state revenues for enrollment growth.”

To compensate for the reduction in state aid, Westbrooks said the district removed some one-time costs, such as the amount set aside in 2015-16 to pay for improvements to the district’s technology infrastructure.

Staffing and benefits

Last year SISD increased teacher salaries by 6 percent and raised the new-teacher salary to $51,500, Westbrooks said. This year the teachers will see a cost-of-living increase of 1 percent.

“Although this year was a tight budget year, our employees remain one of our highest priorities, and we want to be fair and consistent with them,” she said.

KISD employees received a 2 percent raise, resulting in a $1,080 increase for teachers, Champion said.

“While I believe teachers are across the nation underpaid, I am happy to say that Klein ISD teacher pay is very competitive when compared to teacher salaries in our area,” he said.

KISD’s general fund will add 107.3 new positions at a cost of approximately $5.8 million. The newly opened Mahaffey Elementary School will be allotted about 43 of the new staffing positions.

Although no programs were cut within SISD’s budget, some areas had cutbacks, such as staffing adjustments, Westbrooks said.

In 2015-16, due to a projected student enrollment, the district hired more teachers than the staffing guidelines required, she said. Enrollment is on target this year, so the district is able to align staffing with the campus needs without hiring new staff.

District contributions to KISD’s TRS Active Care health plan during 2016-17 remains unchanged from last year, with $20.1 million budgeted for it, KISD Budget Director Beth Rosler said. SISD continues to offer TRS Active Care coverage as well, SISD Director of Communications Kare Garrison said. The district budgeted approximately $9.4 million for the health plan this year.

“We did increase our budget in 2015-16 by about $850,000 because we now contribute an additional amount to the health plans of our lower-paid employees,” she said.

Cutbacks, new initiatives

Champion said KISD is including other proposals in its budget as well.

Further proposals in the budget for the district include an expansion of the Transform Academy and Future Ready 21 programs, said Jenny McGown, associate superintendent for teaching and learning. Transform Academy creates a framework for new visions in public education, and Future Ready 21 will place computers in the hands of every KISD student in third through eighth grade over the next five years.

“We are excited about the expansion of the 1:1 student to computer program at four intermediate schools,” Champion said. “We are also eager to bring this same program as a pilot to fifth-grade students on two of our elementary campuses.”

Despite a smaller budget, additional courses are included in the SISD budget, such as Animation; automotive technology; firefighter science; piping and plumbing, welding; and logistics, planning and management systems, Westbrooks said.

“The shortfall in state revenue coupled with the flat enrollment leads to a very challenging budget process,” Westbrooks said. “In a budget year with no new revenue, we have to scrutinize all costs, and every addition requires an equal decrease.”