As Houston ISD’s state-appointed Board of Managers prepares to vote on the school district’s 2025-26 budget, new data from a budget workshop shows a widening gap between campuses undergoing major reform and those operating under traditional models.
Students enrolled in Superintendent Mike Miles’ 130 New Education System (NES) schools, a sweeping component in his “Destination 2035” plan, will receive $8,566 as base funding per student, compared to $6,133 in non-NES schools.
In total, NES students will receive $10,635, while others will receive $7,103. The additional costs in NES schools include $1,268 for learning coaches and teacher apprentices per student and $660 in teacher salaries.
Meanwhile, special education (SPED) students are projected to receive $1,696 per student in NES schools, while those in non-NES campuses will receive $717.
HISD stated that the difference in spending is because NES schools receive a larger percentage of SPED students.
“SPED is not different because of NES and PUA (non-NES), meaning NES [campuses] do not receive SPED a lot or more than what PUA does,” Miles said. “SPED students in the NES schools have higher needs and there’s a higher percentage of life skill students. So the special ed cost per student is considerably higher.
Balancing the budget
Despite higher funding levels at NES campuses, HISD has trimmed the overall department budget by $71.4 million by reducing staffing and purchased services. According to the district’s general fund expenditure summary, the department budgets will shrink from $447.4 million in 2025 to $375.9 million in 2026, resulting in the $71.4 million difference.
The school district foresees a 9% reduction in the central office, including the academics, chief of staff, communications, Facilities, Maintenance & Operations (FMO), finance, human resources, legal, police and special education.
While HISD anticipates $83.3 million in increased revenue, overall expenditures are still expected to exceed revenues by $55.8 million next year. It expects to end the 2025-26 fiscal year with a $746.1 million fund balance, down from $801.9 million in 2025.
Declining enrollment
HISD’s financial plan accounts for a projected loss of 6,500 students, bringing the total enrollment down to 170,000. The average daily attendance (ADA), which is a key metric in calculating state funding, is expected to remain at 94%.
Lower enrollment contributed to a drop in HISD’s “recapture” amount, a mechanism that redistributes funds from property-wealthy districts.
“Right now, the numbers we are running say our entitlement will not be greater than what we collect,” HISD’s Chief Finance Officer Jim Terry said. “Our entitlement is based on our enrollment.”
Terry added that the recapture value is also dependent on the state’s tax rate, which is expected to go down “one penny” for disaster relief.
To bolster its finances, the school district plans to sell surplus property.
The financial disparities laid out during the budget meeting drew scrutiny from the community.
“I do know that SPED is already critically underfunded. But why do SPED students at PUA schools get just 42% of the funding NES SPED students do?” asked Tracy Byford Lisewsky. “Miles will say that NES SPED students need additional resources, but it doesn’t seem to me that a student’s needs change based on their school funding model. The need is what the need is.”
