The Austin school district’s budget deficit for the 2024-25 school year has ballooned by nearly 50% from officials’ initial estimate — growing from $60 million to $89 million — district leaders told the school board Thursday night.
Officials expect to slash the deficit to $59 million after $30 million in planned cuts, but more trims could be coming for the $956 million budget.
Low property value growth and lower than expected student attendance rates hit the district’s budget assumptions during a year that districts across the state are already pinching pennies and being crippled by funding shortfalls.
“We’re at a point now where almost nothing is not going to be impacted given the magnitude of cuts we have to take across the district,” Superintendent Matias Segura said.
District officials have pledged to keep budget cuts from affecting classrooms as much as possible.
The change in calculations also means the district will end the 2023-24 school year with a $62 million deficit, higher than originally forecast.
The district took on a $52 million deficit for the current school year, but it had expected to reduce that shortfall to $31 million by year’s end through planned cuts.
“We are in a really tight spot,” school board member Noelita Lugo said Thursday. “This is as serious as it gets.”
How AISD’s budget deficit swelled
Last year, property values in the district’s taxing area grew by 19%, so officials had predicted 14% growth for this year, Chief Financial Officer Eduardo Ramos said.
However, values only grew by 5%, according to new data from the Travis Central Appraisal District.
The district’s attendance numbers — which determine how much state funding a district receives — also came out shorter than expected: 64,250 students instead of the 67,786 that had been projected, Ramos said.
The district enrolls about 73,000 students, but the state only provides funding for average attendance — which was 90.6% in the 2021-22 school year, the latest annual breakdown available from Texas Education Agency data.
The TEA also counts pre-K students and some high schoolers who are taking reduced schedule loads as less than a full student when it comes to per-pupil state funding, Ramos said.
Austin school board blames state for budget crunch
The district will have to explore unusual and creative ways to save and generate money if it wants to give students the services they need, said school board Vice President Kevin Foster.
“It’s time for us to adopt a vision of autonomy for us to reduce our dependence on the state wherever and however we can,” Foster said.
Most school board members slammed Texas lawmakers Thursday for the financial woes districts across the state are facing.
During the 2023 legislative year, proposed increases to public education funding became embroiled in a political battle over school vouchers, a controversial program that would use public money to pay for students’ private school tuition.
In a threat that held true, Gov. Greg Abbott said he wouldn’t sign any bill to increase per-student allocations — the basic building block for Texas public education funding — until lawmakers passed a voucher package. The measure never passed, however, as Democrats and rural Republicans in the Texas House blocked “school choice” proposals for fear the program would draw money away from public schools.
“This is a choice that has been made by our state,” board member Lynn Boswell said.
The $30.7 million in proposed budget cuts for the 2024-25 school year include chopping $14 million in contracts spending and eliminating 41 positions at the administration building for $3.7 million in savings. Some, but not all, of those positions are currently vacant, officials said.
The board is also weighing calling a November tax rate election for voters to decide whether to increase school property taxes from $0.8377 per $100 of valuation to $0.9287 — a difference of $35 per month to the average $563,069 Austin home.
If approved, the extra revenue would bring the district an additional $41.1 million to increase staff members’ pay and reduce the deficit.
More cuts are likely to be proposed, but the district wants to keep any downsizing as far from affecting the classrooms as possible, Segura said.
“As the constraints get tighter and tighter and tighter, there are fewer things that we can cut,” he said.
The school board plans to adopt the district’s budget in August.
This article originally appeared on Austin American-Statesman: Austin ISD’s budget deficit swells to $89 million, cuts to follow