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Central Texas school districts face budget deficits after Legislature does not increase key funding

Students at Manor Middle School in Manor ISD walk to their first period class on the first day of school Aug. 15.
Patricia Lim
Per student funding in Texas has been stagnant since 2019, and another legislative session ended this week without any increase to the basic allotment.

The Texas Legislature’s 88th regular session ended on Monday without any increase to the state’s building block for public education spending: the basic allotment. It’s the minimum amount of funding per student that school districts receive from the state.

The last time lawmakers raised the basic allotment was in 2019, when it went from $5,140 to $6,160. But $6,160 doesn’t go as far for school districts in 2023 as it did just a few years ago.

“They're having to cover the increasing costs of fuel, of food, of supplies, of teacher compensation, all of those increasing costs,” said Dax Gonzalez, a division director at the Texas Association of School Boards. “And the state is not offering any support to assist with that.”

For months, public education advocates and school leaders urged the Legislature to raise the basic allotment by roughly $1,000 just to make up for inflation over the last four years. There was a bill that would have modestly increased per student funding and started factoring in inflation. The version of House Bill 100 the Texas House overwhelmingly passed in April would have increased the basic allotment by $90 in the first year and at least $50 in the second.

But when the Texas Senate got its hands on the bill, it became a vehicle for a school voucher program that would have given families $8,000 per student to help pay for private school tuition or tutoring. Ultimately, state senators and representatives could not reach a compromise to get the legislation across the finish line. The author of HB 100, Republican state Rep. Ken King, said that negotiations with the Senate fell apart because senators refused to budge on creating a school voucher program — which faced bipartisan opposition in the Texas House.

“I am truly sorry HB 100 did not pass,” King said in a statement. “But in the end, I believe students, teachers and schools are better off with current law than they would be if we accept what the Senate is offering.”

While public education advocates agree with King that blocking vouchers is crucial to protecting public schools, they are also concerned about how a stagnant basic allotment is going to strain districts’ budgets. Chandra Villanueva, the director of policy and advocacy at Every Texan, expects even more teachers to leave the field.

“It's becoming very unattainable for teachers to afford to stay in the profession," she said. "This is going to have a direct impact on the teacher workforce.”

Villanueva pointed out that the Teacher Vacancy Task Force, which the Texas Education Agency formed at Gov. Greg Abbott’s request, called on the Legislature to increase teacher salaries by increasing the basic allotment. School systems must spend 30% of any increase to that allotment on salaries for teachers, librarians and guidance counselors.

Gonzalez said stagnant state funding is also going to mean more school districts are going to face budget deficits and have to look at cutting programs and services. He added that it is tough to see this outcome when lawmakers had a nearly $33 billion budget surplus.

“It really is tragic that in a session where you had a record budget surplus, we could not get a significant increase for our public school kids,” he said.

Central Texas school districts anticipate that the lack of new state dollars is going to take a toll over the next couple of years in terms of staffing, programs and budget deficits.

Eanes ISD

Chris Scott, the chief financial officer for Eanes ISD, said if the Legislature passed the original version of HB 100 it would have given the district’s finances a boost. He estimates that the $90 increase to the basic allotment that the bill required would have amounted to $750,000 for the 2023-2024 school year.

“For us, that's roughly about 1% of our operating budget,” he said. “So it's not a huge swing, but it is enough that it would swing us from a deficit budget to [a balanced one].”

Scott also calculated that if state lawmakers had increased the basic allotment by $1,000, Eanes ISD would have seen $8.2 million in new funding for the next school year. He said if all of that money was dedicated to salaries, the district could offer 13% raises. That is far beyond what Eanes ISD and other Central Texas school districts are able to offer. And Scott said it has been challenging for the district to recruit employees.

“At all levels of the district, from teachers to custodians to child nutrition workers, we just had a really difficult time staffing all of those things because the competition is so fierce,” he said.

While the Legislature did not increase the basic allotment, it did approve legislation to infuse some new money into school safety. But it has its limitations. House Bill 3 requires an armed person on every school campus and will give districts $15,000 per campus.

“But there's no way you can afford to put an officer on every campus for the amount of that allotment,” Scott said.

That is another new expense that the district is going to have to pick up. At least right now though, Scott said the district is not looking at cutting programs. It also helps, he added, that Eanes ISD voters approved the district’s$131.4 million bond package last month. Bond dollars can be used for capital projects and expenditures, such as repairing HVAC systems. Saving money on repairs frees up more money in the district’s general fund. More than 85% of Eanes ISD and other school districts’ general funds typically go to staff salaries and benefits.

Manor ISD

Manor ISD Superintendent Robert Sormani said when the legislative session started, he was optimistic lawmakers would use the state’s historic budget surplus to boost education spending.

“So, it really only made sense that some of that money would have gone to helping school districts cope with our rising costs,” he said. “And we were certainly surprised that that didn't happen.”

Manor ISD, like other school districts, is seeing inflation take a toll on the basic allotment’s value.

“One of the numbers that I've been citing to people just to give them an idea is [that] just to maintain our fuel costs and our utility costs, we're going to add a million and a half dollars in expenditures to our budget for next year,” he said.

On top of inflationary pressures, Manor ISD currently has a $6 million budget deficit. Sormani said the district is going to have to look at ways to increase revenue, such as a tax rate election, or to reduce costs. One way the district is already doing that is by leaving some vacant positions unfilled or cutting them altogether.

Sormani also said that recruiting and retaining employees is especially hard in Central Texas, because school districts are competing with higher-paying employers like tech companies.

“The competition for workforce is even more fierce here than it is in other parts of the state, which again, drives up the need to increase salaries to attract talent in all ranges,” he said. “And I'm not just talking about our teachers. I have a hard time getting an HVAC person who can work on our air conditioning systems or a plumber.”

Sormani added that he is concerned the political fight over school vouchers is going to continue to keep the Legislature from investing in public schools, which ends up hurting students.

Austin ISD

About a week and a half before the Texas legislative session ended, the Austin ISD school board approved a significant compensation package for employees. It included a 7% raise for teachers, counselors and librarians as well as a $4 raise for hourly employees, bringing the district’s minimum wage to $20 per hour.

Ahead of the unanimous vote last month, School Board President Arati Singh said approving the proposal was a bit risky since it did not look like the Legislature was going to increase public school funding. That’s because the compensation package is expected to result in a $53 million budget deficit. While Austin ISD officials have strategies to reduce that deficit during the next school year, an increase to the basic allotment would have been a big help.

Ken Zarifis is the president of Education Austin, a union representing AISD employees, that worked out the compensation deal with the district. He praised Austin ISD for raising pay, when the Legislature didn’t.

“I am glad that the district had the courage to step out and say, 'We're going to do this because it's right. We know there's a level of risk to it. But we can manage that because we have to take care of our people,’” he said.

He said even though he is relieved that school voucher legislation did not pass, he is also angry that another legislative session has ended without fully funding public schools.

“I can assure you that people in the state want public education funded. The Legislature refuses to do that," he said. "And I think it's a dereliction of duty on the Legislature's part."

What’s next?

Abbott said last month he would call a special session if the Legislature did not pass a broad enough school voucher bill. Chandra Villanueva expects a bipartisan group of lawmakers in the Texas House to continue opposing vouchers during a potential special session.

“I do think the House has been very strong on their opposition to vouchers,” she said. “They've had multiple opportunities to reject those proposals and have taken every opportunity to do so.”

Gonzalez also expects the House to keep blocking school voucher bills.

“What it appears to me is that individuals in the House have really been voting their districts,” he said. “They've been hearing from their folks back home about the lack of support for vouchers.”

Abbott has already called one special session focused on property taxes and border security. In a statement this week he said “several special sessions will be required.”

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Becky Fogel is the education reporter at KUT. Got a tip? Email her at Follow her on Twitter @beckyfogel.
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