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Southwest ISD schedules public hearing on 2025–26 budget, keeps tax rate recommendation unchanged
Summary
Board heard a budget presentation showing a projected operating gap, an estimated fund balance, and a recommendation to keep the tax rate unchanged; public hearing set for Aug. 26 and final adoption expected at next meeting.
Board President and the Southwest Independent School District Board of Trustees on Tuesday received a presentation on the district's proposed 2025'26 budget and set a public hearing for Aug. 26, 2025, before a planned vote at the next regular meeting. The district's finance staff recommended keeping the current tax rate and outlined revenue, payroll and fund-balance projections ahead of the adoption vote.
The presentation showed the district's estimated FY2026 picture and near-term next steps. "We are 1 week away from approving our budget for the 25'26 school year," the district's finance staff said, adding the budget under consideration reflects recent legislative funding and planned salary adjustments. The staff reported projected total payroll near $147 million and said the operating picture includes a projected shortfall of roughly $3.4 million for the coming year.
Why it matters: the board must adopt a budget and set a tax rate each year; the tax rate influences property-tax bills and the district's ability to support schools and debt service. The board's recommendation to hold the rate steady preserves current revenue assumptions while staff pursues other budget adjustments and debt-management options.
Board staff said projected revenue for the 2025'26 budget period is in the neighborhood of $181 million and that proposed expenditures total about $184 million, producing a projected deficit of approximately $3.4 million. Staff estimated an ending fund balance of about $54.5 million, which they said meets the district's three-month reserve guideline. The presentation noted federal funds previously discussed have been approved but not yet allocated to the district and therefore are not included in the budget baseline.
On tax policy, staff recommended keeping the district's tax rate at the current advertised level; the recommendation will be part of the public hearing notice and the Aug. 26 agenda for final action. Staff also told the board they are factoring a change in the state homestead exemption (referenced in the packet as a $240,000 homestead figure) into projection models for the tax roll and indicated taxpayers may see reductions if they qualify for the homestead adjustment.
The board approved a motion to set Aug. 26, 2025, at 5:30 p.m. as the public hearing date on the proposed budget and proposed tax rate. Final adoption of the budget and tax rate remains scheduled for the board meeting immediately following the hearing. The presentation and staff comments emphasized continued work on balancing the budget and using fund balance conservatively while maintaining required reserves.
Board members and staff emphasized the next steps: a public hearing on Aug. 26 followed by formal consideration and adoption. "We're in the home stretch," the finance presenter said. "We're in a much better place" than earlier projections, but he and other staff urged the board to view the figures as subject to minor adjustment before adoption.
Ending: The district will present the final budget and tax-rate ordinance at the Aug. 26 meeting after the public hearing; taxpayers and community members may address the board at that hearing.
