Northwest ISD Superintendent Mark Foust shakes a student’s hand during a school board meeting Feb. 26, 2024, at the district’s administration building in Justin. (Courtesy photo | Northwest ISD)
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Northwest ISD is blaming the state for the district’s adoption of a deficit budget for the 2024-25 school year.
During a June 24 meeting, the Northwest ISD board voted unanimously to adopt the more than $500 million 2024-25 budget. The general fund budget, which funds daily operations, outlines $321.1 million in revenues against $336.9 million in expenditures.
The result: a $15.8 million deficit that has to be covered by the district’s reserve fund.
“I won’t get on my soapbox,” board president Steve Sprowls told district administrators. “When you talk to your state reps, paint the picture … let them know what’s going on in the classrooms.”
Compared with the district’s 2023-24 budget, the new numbers force Northwest ISD into a deeper financial hole. Last budget year, the district adopted a $2.9 million deficit and took in $323.1 million in revenue.
This year, the district adopted $2 million less in revenue and a deficit that more than quadrupled last year’s.
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Without additional state funding, the losses could be even greater next budget year, Chief Financial Officer Jonathan Pastusek told the board.
The Robin Hood law requires funds from wealthier districts to be redistributed to poorer districts. The law, using what is often referred to as recapture, examines districts’ taxes to determine whether money is taken or given.
This year’s budget reflects a temporary reprieve from state recapture payments because of the state’s lowering of the district’s tax rate, which Pastusek warns is a fleeting advantage.
Next budget year, the district expects recapture – or payment back to the state – to exceed $28 million.
“I really do not want to have a deficit budget, but (we have to) due to the state not funding public education as they should,” board secretary DeAnne Hatfield said.
The district’s adopted expenditures also increased $10 million from the previous budget year, partly reflecting an increase in district-wide enrollment.
A notable portion of these expenses, $200 million of the adopted $336 million, is directly allocated to the classroom, Pastusek said.
The district would rather adopt a deficit budget than make decisions such as cutting student programs and putting teacher and staff raises on hold, Hatfield said. In April, the district approved a 2% midpoint raise for all district staff — costing the district $5.6 million.
“In (that), we as board members, want to make sure we do not cut programs and that we give our employees the raises that they deserve, I am making the motion to adopt the budget,” Hatfield said.
Covering the deficit through the district’s reserve fund will decrease the expected fund balance to about $92 million, which represents 27.4% of the budget.
The state requires school districts to maintain three months of operating expenses in their fund balances, or 25% of their budgets.
At the board’s Aug. 13 meeting, trustees will consider calling a voter-approved tax rate election. If approved, this would allow voters in the district to decide on raising the maintenance-and-operations tax rate by 3 cents to secure an additional $15 million in funding.
Without the tax rate increase, the district would be forced to minimize hiring, increase class size ratios and look at programs to cut or reduce, Pastusek told trustees during a May meeting.
Matthew Sgroi is an education reporter for the Fort Worth Report. Contact him at matthew.sgroi@fortworthreport.org or @MatthewSgroi1. At the Fort Worth Report, news decisions are made independently of our board members and financial supporters. Read more about our editorial independence policy here.
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