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La Porte ISD financial update: projected FY25 deficit narrows to $7 million as property values rise and recapture increases
Summary
Stacy, the district finance presenter, told trustees May 13 that estimated FY2025 revenue rose about $11 million, narrowing an earlier $14 million projected deficit to an estimated $7 million shortfall driven largely by higher property valuations and an associated increase in state recapture.
Stacy, the district finance presenter, told the La Porte ISD board on May 13 that estimated revenue for fiscal year 2025 rose to about $117 million, an increase of roughly $11 million from the amended budget projection. That higher revenue lowered the district’s forecasted operating gap: instead of a $14 million deficit shown in earlier estimates, the district now projects an approximate $7 million shortfall for FY2025.
The change reflects a $1 billion increase in the district’s taxable property valuation (the presenter noted an estimated T2 value of about $14.7 billion for the fiscal year), which generated more local tax revenue but also raised the district’s state recapture payment. Stacy said the recapture payment is now estimated at about $35 million, up from $26 million in the amended budget; recapture is the state mechanism that redistributes property-wealth funding among districts.
Stacy walked trustees through key budget drivers: enrollment and average daily attendance (ADA), certified property valuations, and tax rates. She reminded the board that La Porte ISD’s current combined tax rate is 0.9739 per $100 of assessed value, split between maintenance and operations (M&O) and interest and sinking (I&S). The presenter explained how the state’s “glass and bucket” funding model uses local property revenue first and supplements with state funds when local revenue does not meet the state’s funding formula; conversely, districts with higher local revenue may pay more into recapture.
Board members asked technical questions about property valuation, the district’s days-of-fund-balance target and past recapture totals. Stacy said the district’s estimated FY2025 ending fund balance would be about $54 million, roughly equivalent to 150 days of operating reserves under district policy. A trustee noted that over the past 15 years La Porte ISD has paid about $457 million in recapture; Stacy confirmed that figure and described recapture as a long-term factor in budgeting.
Stacy outlined next steps and timelines: the board’s budget workshop was scheduled for May 20 to review FY2026 compensation and assumptions; the district will hold its public hearing on the proposed budget and tax rate in June; and the presenter reminded trustees that the Texas Legislature’s regular session calendar and forthcoming actions could affect final budget assumptions. No new taxing action or budget adoption occurred at the meeting.
Decision and actions
The board did not adopt a new budget or change tax rates at the May 13 meeting. Staff will present budget options at the May 20 workshop and return recommended budget and tax-rate proposals for subsequent public hearing and adoption steps.
