Northside ISD leaders outline $100M-plus budget gap as House Bill 2 evolves

Dr. Kraft, Northside ISD superintendent, told the Board of Trustees at a called meeting that the district is planning for the 2025–26 budget while tracking state school‑finance legislation and declining enrollment. "The answer is no," Dr. Kraft said when asked whether the legislative proposals under current runs would close a deficit the district now estimates at just north of $100 million. ESSER federal relief funds that the district used to subsidize operating costs expired Sept. 30, 2024, he said.

The board heard detailed staff analysis of how the committee substitute for House Bill 2 (CSHB 2) would change the district's revenue mix, special program allotments and required pay‑increase calculations. Staff warned the bill's current formula—if enacted as drafted—could shift more of a revenue increase into mandated teacher, counselor, librarian and nurse compensation (a 40% distribution under the committee substitute) while the net non‑special‑program revenue available to offset district costs would remain limited.

Why it matters: Northside officials said the combination of an expiring federal funding stream, a projected enrollment decline and the way state proposals calculate revenue and ‘‘hold‑harmless’’ adjustments could force program consolidations at campuses or other staffing changes to bring payroll (about 88% of operating costs) into alignment with student counts. Trustees pressed for transparency on how campus programs would be evaluated and for additional data on ESSER usages.

Staff presented these figures and context: the district's projected enrollment for 2025–26 is roughly 98,400 students; ESSER monies were expended on Sept. 30, 2024; a staff summary of fiscal 2024 special program allocations showed special education state allocation that required 55% spending and an actual special‑education spend substantially above that required amount (staff cited the audited 2024 figures showing required state spending of about $58.9 million and actual district spending on special education of roughly $144 million). Staff also noted the district is spending materially above required allotments for some programs (gifted‑and‑talented and college/career readiness were cited as examples) and that much of the excess spending is payroll related.

Trustees asked how program decisions will be made if campus classes do not ‘‘make’’ by student request. Trustee Freeman said the board must be realistic: "We only have so much money," she said, urging a balance between protecting programs that attract students and making necessary financial adjustments. Dr. Kraft told the board that the district's near‑term objectives are to protect the integrity of core instructional and extracurricular programs where possible and to avoid a formal reduction‑in‑force; he said the district is working to reassign and reprogram staff where feasible rather than implement layoffs. "We're not closing programs. We're not shutting down programs, but we are looking at efficiencies," Dr. Kraft said.

Board directions and follow‑up staff work included: (1) staff will provide an ESSER‑utilization breakdown and a staffing slide package for further review; (2) staff plan to present an open‑enrollment policy and marketing plan for board consideration on April 22; and (3) the district intends to hold more frequent finance updates (monthly call meetings) while the legislative session continues and preliminary property valuations are released. Staff also told trustees that current state model runs are preliminary and that multiple consulting runs (district consultants and the Texas Association of School Boards data) show differing outcomes; staff cautioned trustees not to use those early runs as definitive budget planning figures.

Board members repeatedly asked that campus‑level communications be handled carefully so families and staff do not mistake ongoing planning for finalized decisions. Staff said historically campus‑level course viability and scheduling decisions are made through the master‑schedule process and may not always come back to the full board unless a district‑level program is eliminated.

Ending: Trustees did not take formal budget actions at the called meeting; they instructed staff to return with more granular ESSER and staffing data, to bring the open‑enrollment policy for consideration on April 22 and to provide monthly finance updates as the legislature finalizes any school‑finance bills.