Houston ISD’s state-appointed Board of Managers voted unanimously to pass a proposed $2.1 billion budget for the 2025-2026 school year.
Superintendent Mike Miles called it essentially “a balanced budget that’s a credit for those on the board.”
“We started with a hundred million dollars deficit…we didn’t know what the state money was, how the state money was gonna come out,” said board president Ric Campo. “To get this budget deficit down from the original budget…to a $14 million deficit is pretty amazing. We have better revenue, but also reasonable expense management. It is critical to have a balanced budget and to have a strong fund balance… It’s not easy to do in this environment.”
New board members vote on budget
Four new board appointees, Edgar Colón, Lauren Gore, Marty Goossen and Marcos Rosales, will weigh in on the budget during their first board meeting. Their vote follows the abrupt removal of Cassandra Bandy, Rolando Martinez, Audrey Momanaee and Adam Rivon, three of whom voted against the budget last year and were the board’s most vocal opposition to Miles to date.
“I’m looking forward to working with the new board members,” Miles said. “It’s not gonna be easy for them, but I feel confident this new board will also do great things for the district.”
During a press conference, Miles praised the board members who were removed, adding they took HISD to new heights of growth by supporting reform efforts.
“We owe them a debt of gratitude,” he said. “They were board members during an intervention, which makes it even tougher.”
Despite lingering concerns about the sustainability of state funding and the long-term impacts of enrollment trends, the HISD leadership emphasized that the district is on solid financial ground heading into the new fiscal year.
The budget approval marks a pivotal moment in the district, days after the Texas Education Commissioner Mike Morath replaced nearly half the board.
HISD budget: by the numbers
The school district is closing out the fiscal year on a stronger financial footing than it began, despite losing federal pandemic relief dollars and facing declining enrollment. In the proposed budget for the upcoming school year, HISD projects a revenue increase of $175 million (up 4.2% from last year) and $2.12 billion (down 2.5%) in expenditures.
Miles touted a modest deficit of $14.6 million, a dramatic improvement from the $246 million deficit at the start of the current year. Meanwhile, the fund balance at the end of the fiscal year stands at $800 million, down slightly from earlier projections due to amendments made in June, including a $31 million cut to instructional spending and a $14 million reduction in recapture payments to the state.
A tale of two students
The budget reflects Miles’ systemic reform through his New Education System (NES) in 130 campuses. These schools follow a centralized curriculum and test-based evaluations, against which parents and teachers have been vocally protesting at board meetings.
At the center of the proposed budget is a funding disparity between NES and non-NES campuses, where NES students are slated to receive a base funding of $8,566, compared to $6,133 in non-NES schools.
Taking into account districtwide services and special education funding, the total per-student cost climbs to $10,635 for NES students versus $7,103 for non-NES students.
What does the budget include?
According to HISD documents, the school district is proposing the following to come out of HISD’s $2.02 billion general fund:
- $1.24 billion for instruction, which comprises nearly 59% of the general fund
- $225 million on school leadership
- $200 million on facilities maintenance and operations
- $60 million on administration
- more than $78 million on campus security and data processing services
- $38 million on transportation
- $58 million on counseling and evaluation services
- $26 million on health services
- $158 million on food (also supplemented by the nutritional services fund)
Miles attributed the additional expenditure increase to teacher pay raises ($11.7 million), pre-Kindergarten expansion ($5 million), special education teachers and teaching assistants ($13 million) and security measures ($3.2 million).
“There’s a lot of worry about the legislature not coming through for the public head side, especially after the vouchers passed, and then there was a back and forth from both the Senate and the House on the budget,” Miles said. “I went up there a couple of times…nobody paid for the advocacy. I’m not a politician, but both sides of the aisle…worked hard to get public education the money that you see on the screen.”
What’s getting cut?
Several major operational areas will see cuts:
- Central office departments will see a $29 million cut
- Food services: $15 million
- Student transportation: $14 million
- Non-NES campuses: $14 million
- NES campuses: $21.5 million due to a decrease in the number of teachers
- One-time expenses: $12.7 million
- Recapture payments: $44 million
Tax rates and exemptions
Property taxes comprise $1.56 billion (or 75% of the funds) of the general fund revenue.
The debt service revenue, which pays back the district’s principal and interest on long-term debt obligations, amounts to $389 million, with property taxes making up $374 million (96%).
The proposed combined tax rate remains at $0.859 per $100 of assessed property value, which is slightly below the voter-approval threshold that would trigger an election. This includes a $0.6923 maintenance tax and a $0.1667 rate for school debt service.
This simply means that for every $100 of a property’s taxable value, HISD collects 86 cents, with roughly 69.23 cents going to daily operations and 16.67 cents going to bond debt.
According to HISD’s public meeting notice, the average tax for a home in Houston will increase by $59.35 due to increased home values. HISD will offer a state-mandated 20% homestead exemption for homeowners, which the school district cannot reduce until 2027.
What community members said
Community members who spoke during the budget meeting expressed concern about the provisions of the budget.
Harvard Elementary parent Quynhthy Bui asked the board not to vote for the budget and an extension of Miles’ contract.
“NES schools are allocated 96% of the funding given to traditional schools, nearly the same amount of money for far fewer students,” Bui said. “You probably heard that the NES school serves higher need populations, but…the total number of special education and economically disadvantaged students is split nearly evenly between NES and traditional schools.”
Others questioned the new board members’ preparedness to vote on the budget.
“Martin Luther King Jr. believed a budget reflects not just numbers, but values,” said parent Christine Hurley. “Tonight, this board, including four brand new unelected, unqualified members, is being asked to include a multi-billion-dollar budget that fails that test. You’re being asked to pass a budget that disregards students, teachers and the communities…How can you responsibly vote yes on a budget you didn’t help create and don’t fully understand? This is not fiscal responsibility. It’s not educational leadership. It’s certainly not moral.”
