School districts across the Houston region are cutting budgets to cover $857M in shortfalls

Staring down a $100 million deficit budget, even after deciding to close three campuses in February, Aldine ISD trustees have a difficult decision to make this week. 

Voting on Aldine ISD’s budget on Tuesday will involve a 10% cut to the district’s budget, including 100 employees. The proposed budget comes after the board voted to close Conley, Sammons and Gray elementaries earlier this year. And more campuses may need to be closed before the 2025-2026 year to remain afloat. 

“In recent years, Aldine ISD has had to face some tough realities: student enrollment declines, a lack of affordable housing throughout the community, declining birth rates, and decreased funding from the state,” district spokesperson Sylvia Samuell wrote. 

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The district on the north side of Houston is led by well-known superintendent LaTonya Goffney, and is praised for innovations like its year-round school calendar at some elementary campuses. Over the past four years since the pandemic, the district has lost more than 6,000 students, putting enrollment at 59,996. 

At least six other districts across the Houston area have reported multi-million dollar deficits as they face the 2024-2025 budgeting process this summer, totaling at least $850 million in shortfalls.

“It really is a perfect storm,” said Bob Popinski, executive director of Raise Your Hand Texas. “Since 2019, we've had double-digit inflation. So think, increased costs in fuel, property and casualty insurance and construction costs and health insurance costs, and even food services.”

Part of the dilemma has come from the first year without federal COVID relief (called ESSER) funds since the program was instituted. Most districts also report enrollment dips and struggle with getting students to school on a regular basis. 

The kicker, however, is floundering state funding that has forced districts to make “jaw-dropping” cuts.

Data shows school funding decrease

A recent report from the Texas Education Agency shows that state funding has actually decreased over the past 10 years Gov. Greg Abbott has been in office, when accounting for double-digit inflation, according to the TEA. 

In 2014, the total per student revenue from state and local taxes was $6,680, but when adjusted for inflation, that sum dropped to $6,669 in 2023. And in the same year, just looking at state funding, the sum was $4,235, a number also dropped to $4,196 when adjusted for inflation in 2023, according to the report. 

A recent report from the Texas Association of School Business Officials shows that over half the 313 districts surveyed across the state are projecting deficit budgets for fiscal year 2024. 

“Nearly 80% of respondents face challenges with deficit budgets or insufficient resources, a concern ranking among the top three challenges for half of them,” reads the May 2024 report overview

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Just under half the districts surveyed are presently undergoing significant cuts, and over half said they would have to take teacher raises out of cuts. More than 175 districts reported that they would need to make budget cuts and use their fund balance to stay afloat. 

“The headlines from now until the beginning of next school year are going to be kind of jaw dropping in the amount of programs being cut,” Popinski said. 

Arguments at the state level

State Rep. Jon Rosenthal, whose district overlaps with Cy-Fair ISD, had enough after he heard the district would have to cut 600 positions and spend $70 million in fund balance to address its $138 million budget deficit. 

In May, Rosenthal wrote to Abbott asking for a special session to raise the basic allotment from $6,160 per student, a number that is $4,000 below the national average. 

Abbott’s office claimed that school funding is higher than it had ever been. 

Rosenthal and others had a chance to increase school funding, according to the Governor's Office, in the last two special sessions when Abbott promised public education some of the surplus if school vouchers passed, a plan that he now says he has the votes for leading into the upcoming 89th legislative session. 

He has also blamed school districts for their budget shortfalls, saying they mismanaged federal COVID funding and that the total funding per student actually exceeded $12,000, so looking at just the basic allotment was “misleading.”

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The governor’s office did not respond to requests for comment on what exactly was being counted in that figure. 

“There is some accuracy in how districts chose to deal with their funding,” said Zeph Capo, Texas American Federation of Teachers president. “But I think that they were doing that as a stopgap. Because they thought surely, four years later after a pandemic, the state would actually act.” 

Nikki Cowart, Cy-Fair AFT president said that it was “disingenuous” of the governor to play the “blame game.” 

Cy-Fair ISD “has been guilty of using those ESSER funds for experts in the classroom… (but) those funds were used to do all that we could for our students,” she said. 

Abbott’s office also wrote that enrollments across Texas were declining as parents “complain about their growing dissatisfaction with the ideological leanings of education delivered by some public schools.” 

What is actually going on with school finance?

Policy analyst at the Texas House, Eva Deluna, shed some light on the funding dilemma. 

“The $12,000 figure is taking into account state, local, federal, any other money that a school district might have available. But the main thing that people might not notice is that it includes revenue for debt service,” she said. 

Debt service is money that goes toward paying off school bonds. That money cannot be spent on students, so Deluna said including that in the total funding given per student is misleading. 

“In the 30 years that I've been looking at the state budget, there's never been a debate about, ‘Are we doing enough?’” Deluna said. “It's always, ‘Compared to last time, is it more or less?’”

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Deluna said if adjusted for inflation, the basic allotment would be over $7,500,  and coupled with some of the recent unfunded mandates, like placing armed security guards at every campus, districts have gotten a “setback.”

Another concern is the historic $20 billion surplus the state is sitting on, Deluna said, alongside a $20 billion “rainy day fund” or fund balance. 

“So to tell schools, ‘you figure it out’ when there clearly is money at the state level… it’s refusing to support public schools,” Deluna said.

How is it impacting school districts?

In November, Spring Branch ISD started making cuts to close a $35 million shortfall anticipated for the 2024-25 school year — which included cuts to 306 staff members, the closing of two campuses, and the slashing of elementary and middle school counseling programs. 

In May, Houston ISD ― the state’s largest district with nearly 190,000 students ― announced that it would be cutting dozens of staff and teaching positions as part of a “reduction in force” before the beginning of the 2024-25 school year.

The board’s approval means HISD can proceed with cuts to any current campus-level jobs, including nurses; librarians; counselors; assistant principals; principals; reading, math and science teachers; fine arts and other elective instructors; speech therapists; magnet coordinators; and special education coordinators.

State-appointed Superintendent Mike Miles estimated that the district will face an estimated $450 million budget gap next year, with schools outside the New Education System expected to see cuts of up to 12%. 

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Even though families have left HISD and other district to enroll in suburban districts, Capo said those districts are even still struggling financially.

Conroe ISD in Montgomery County, will proceed with a projected budget deficit of $16.6 million, Katy ISD, west of Houston and generally growing with enrollment, has a projected budget deficit of $7.8 million and Friendswood ISD, a smaller district between Houston and Galveston, projects a deficit of more than $705,000.

“There’s no doubt about it that the current individuals in power… are directly responsible for what parents and students and teachers are feeling in public schools across the state,” Capo said. 

Montgomery ISD, a district far north of Houston, also anticipates entering the 2024-25 fiscal school year with a budget deficit. However, it’s still unclear how much of a shortage the district faces, Superintendent Mark Ruffin told the Chronicle earlier this week. Right now, his focus is on the next legislative session. 

"We all know that there is a political game to be played within the last legislative session and the special sessions that followed," Ruffin said, but it's time for the conversation to move on.

"'How do we right the ship for public education?'" he said.

An earlier version of this story that appeared online on June 7 and in print on June 10 inaccurately stated the date of the scheduled vote on Aldine ISD's budget. The vote will take place on June 11.