'We are pretty much stuck': Most Central Texas school districts face budget shortfalls

AUSTIN (KXAN) — Spanish teacher Shaun Hopkins watched from his laptop as the Austin school board discussed hypothetical budget cuts that would impact his kids, his classroom, and his friends.   

In the July workshop, livestreamed on YouTube, Austin Independent School District leaders said the district would need voters to approve a tax increase and trim millions from its budget to close a $119 million deficit.

According to Superintendent Matias Segura, it was fair to assume Texas lawmakers would not act on increasing public school funding.

The district could save millions if it stopped busing kids across town to magnet schools. Another $3 million if they got rid of nurses. An additional $1.4 million if the district changed librarians into aides.

Hopkins, who runs the dual language program at Small Middle School, felt a gut punch when district officials mentioned the $20 million the district could save if it stopped offering special education and bilingual teacher stipends—two roles consistently vacant across the state.

“I can tell you that a lot of teachers might not stick around if you take away that stipend,” Hopkins said. “That’s how they are raising their families in this expensive city.”

The superintendent cautioned that the options discussed during the meeting were just that: options — a list of things that could be eliminated.  

But he warned, eventually, something would have to be cut.

School boards across Texas are having conversations around potential budget cuts as they deal with inflation, an attendance rate that never quite bounced back after the pandemic, and the Texas Education Agency’s forecast of flat enrollment over the next five years.  

Our team found that 18 of the 24 Central Texas school districts that have already adopted budgets for this school year are in deficit. School budgets show shortfalls ranging from $374,000 at Rockdale ISD to $119 million at Austin ISD, the area’s largest school district.

The shortfalls extend beyond Central Texas. Houston ISD is facing a $211 million deficit. Dallas ISD confirmed it’s $187 million in the red. Fort Worth ISD is $17 million, and El Paso ISD is $12 million.

The impact of the budget shortfalls is already apparent in some districts.

A compensation agreement between Austin ISD leadership and the union Education Austin shows that teachers will only get a permanent pay raise if voters approve a tax rate increase.

Districts across Texas are using the voter-approved tax rate increase, or VATRE, to raise additional funding amid budget shortfalls. Austin ISD stands to raise $171 million in additional funding if voters approve it, but the state is expected to recapture most of that money and re-distribute it to other school districts.

The administration said that even if voters approve that tax rate increase and the district meets its multi-million-dollar budget cut goal, it will still have a $41 million deficit.

“We have values that we're trying to protect,” Segura said. “You can make an adjustment and save $22 million, you know, $19 million, but at what cost?”

Leander ISD officials said in a May board meeting that the state underfunded its special education program by $25 million.

Round Rock ISD balanced its budget through what its superintendent called “surgical but difficult” cuts. School leaders made those cuts to the high school, middle, and elementary school classrooms.

“There is not much more we can do after this year if our state doesn’t change the way it funds public schools,” Round Rock ISD Superintendent Hafedh Azaiez said. “We are pretty much stuck.”

In January, school districts will look to lawmakers to act on mounting pressure to increase funding for public schools. They are also bracing for the governor’s mission to create education savings accounts, a program allowing state dollars to go to private schools.

State Rep. Gina Hinojosa, D-Austin, said the billions in additional funding for public schools was not authorized because Texas Gov. Greg Abbott insisted on it being tied to vouchers.

“It is not right to play games with our kids and hold them hostage in exchange for the funding they're entitled to,” Hinojosa said.

Gov. Abbott’s Office told KXAN he “will not stop until school choice is the law of the land.”

Sen. Brandon Creighton, R-Conroe, is leading the charge for the voucher-like program in the Texas legislature. He said previous bills increasing public school funding failed during the regular session and in the multiple special sessions because superintendent and teacher organizations were testifying in committees; they would rather not have the funding if it meant school choice would pass.

“If they can kill that extra school choice funding, they'll accept the new money. But if they can't kill school choice, they'd rather deny themselves the new money. That's really tough testimony, right?” Creighton said. “They should accept our efforts to provide unprecedented funding for public schools and accept these education options and choices for the children of Texas that need help the most.”

The last time lawmakers increased the basic allotment, the base amount of money the state provides per student, was in 2019 under House Bill 3. The legislation allocated $6,160 to school districts per student, factoring in attendance.

The legislature has not increased it in the five years since then, which have been marked by a pandemic, inflation, and a historic teacher shortage.

Multiple Central Texas school leaders told KXAN they need at least a $1,000 increase to the basic allotment to restore the purchasing power they had in 2019. However, lawmakers’ most recent proposals, the increase fell short of that figure, and all failed to pass.

House Bill 100, authored by Rep. Brad Buckley, R-Killeen, proposed a $90 increase to the basic allotment (and a $500 allotment for students evaluated for special education services) during the regular session. Senate Bill 2 would have raised the allotment by $75 during the third special session. House Bill 1, authored by Rep. Brad Buckley, R-Killeen, tried to add $700 to the basic allotment during the fourth and final special session.

“I was shocked when they were talking about $50, $100. What would $100 do?” Azaiez said. “I mean, we'll take it, obviously. We're desperate here. But like, honestly, that was not what we need. We need a lot more.”

Creighton said he is still weighing the opinions of new members on whether to propose another bill that ties public school funding increases and education savings accounts in the same legislation.

Creighton recalls his education savings account bill from the regular session, Senate Bill 8, which would have allocated $10,000 to small districts for every student they lost to private schools through the education savings accounts. Districts would have been entitled to that money for up to five years after the student left and would only be eligible if it had less than 20,000 students enrolled.

“Superintendent organizations are now asking, 'Can we have that deal back?'” Creighton said. “That's why they’re coming to me now saying, 'Can we get that deal back that was on the table when the session ended?' Because that actually was a good deal.”

Creighton did not name the superintendents he was referring to.

Hinojosa said House lawmakers are three votes down in their effort to defeat education savings accounts because of the governor’s efforts to “[take] out Republicans who were opposed to vouchers.”

“We're fighting to keep those public dollars for our students, to pay our teachers, who are about $10,000 below the national average when it comes to teacher pay, to have the best teachers we can in the classroom to educate our kids,” Hinojosa said.

“Shouldn’t we ensure that our kids can access the best education they can at our neighborhood public schools when those are the schools everyone is entitled to go to?” Hinojosa added.

Hopkins' daughters returned to school Tuesday, optimistic and excited about the school year ahead, while Shaun met his new class of students, worried about decisions that are out of his hands.

His district, Austin ISD, aims to cut $48 million from its budget regardless of whether voters approve a tax rate increase.

“Knowing how deep that deficit is, something will have to be cut,” Hopkins said. “A lot of time, once the funding is cut, it never comes back.”

Digital Data Reporter Christopher Adams, Investigative Photographer Chris Nelson, Graphic Artist Christina Staggs, Digital Executive Producer Andrew Schnitker and Digital Special Projects Developer Robert Sims contributed to this report.