Ysleta ISD projects $27.3 million budget gap for 2025–26; district and unions spar over health-plan changes

Ysleta Independent School District trustees heard a budget presentation June 11 that showed continued enrollment declines, multi‑year staffing reductions and a proposed 2025–26 operating budget that would use $27.3 million of fund balance to close a deficit.

The district’s budget presenter, Lindley Camburn, told trustees the district has budgeted for annual student losses of about 1,500 but saw fewer losses this year: “This year, we only lost 851 students,” Camburn said, noting long‑term trends that drove staffing reductions and lower revenue. Camburn said the recommended budget would still leave an estimated $27.3 million gap after the district’s expense reductions and that the district plans to bring a payroll loan for board approval on June 25 to ensure July and August payroll can be met.

Why it matters: trustees were presented with several interlocking pressures — falling enrollment that reduces state funding, carryover ESSER timing that previously masked general‑fund costs, and rising health‑plan claims — leaving the district to consider use of fund balance, targeted personnel reductions through attrition, and changes to employee benefits that could materially affect staff take‑home pay.

Key numbers and context

- The district reported multi‑year enrollment declines, with recent post‑pandemic average student loss of about 1,316 per year; the current year decline was 851 students. Camburn said district staffing reductions have averaged roughly 77 classroom FTEs per year since the pandemic and about 28 central‑office FTEs per year. - For fiscal years shown in the presentation, actual revenues and expenditures were listed as: FY22 revenues $405.3 million and expenditures $388.1 million (fund balance increase $17.2M); FY23 revenues $387.9M and expenditures $405.6M (loss $17.7M); FY24 revenues $387.3M and expenditures $416.9M (loss $29.6M). - Camburn said the district expects a cash shortfall in August and will present a payroll loan for board approval on June 25. - The proposed 2025–26 general fund budget shows a recommended use of $27.3M of fund balance; across all funds the total proposed use of fund balance is about $27.8M, including $538K from Child Nutrition. - At the end of the last fiscal year the district’s unassigned fund balance was roughly $72M; staff projected it could fall to about $35–37M after current‑year use and to much lower levels if additional deficits materialize.

Budget reductions and revenue actions discussed

Camburn outlined reductions already taken and planned: a voluntary early‑retirement/resignation incentive that 145 FTEs accepted (staff estimate: $9.8M in savings), reductions to substitute and professional‑development costs, turning off utilities at closed campuses, a plan to sell additional properties (two already approved and three more to be considered June 25), and discretionary‑spending cuts at campus and department levels. She said the district avoided a reduction‑in‑force and has not declared financial exigency, to avoid state monitoring.

Health plan redesign and employee contributions

The district’s employee‑benefits consultant, Elizabeth (Liz) Bebo of Hub International, presented projected health‑plan costs and a recommended move from four plans to two plan designs (a co‑pay plan and a qualified high‑deductible health plan). Bebo said the plan’s projected total claim cost for 2025 is about $60 million and that current district plus employee contributions total about $41 million, leaving a structural gap unless plan design or contribution changes are adopted.

Bebo and Camburn provided these details:

- District contribution per employee per month was shown as $592.83 (about $31 million annually). - Combined district and employee contributions were about $41 million; actual claims in 2024 were roughly $54 million and projections for 2026 reached about $60.8 million in the presentation. - House Bill 2 (state legislation) creates several new allotments. The district’s staff estimated total additional state funding related to recent legislation at about $38.2 million, but much of that funding is restricted by law to specific uses. Camburn noted that only about $5.7 million of those new amounts was unrestricted and available to offset the general‑fund deficit. - Proposed plan design examples shown by the consultant included a co‑pay plan with a $2,000 deductible (ACO network) and $4,000 out‑of‑pocket cap, and a qualified high‑deductible plan with the IRS‑dictated individual deductible (noted as $3,400 for 2026 in the presentation). Bebo said those changes plus modest employee premium increases would be expected to bring the plan’s revenues and expenses into balance under the consultants’ modeling.

Staff and union comments

Several speakers during public comment and trustees’ questioning urged the board to protect employee take‑home pay and asked the district to avoid canceling state raises with higher insurance premiums.

- Heather Senor, identified as a YTA board member and special‑education teacher, said employees were excited to see state HB2 money but were concerned recent insurance changes would “effectively cancel out any gains,” and urged the board to avoid shifting costs onto employees. - Jeff Senor, president of the Ysleta Teachers Association, asked trustees not to “wipe out any pay increases by forcing employees to have to pay more in their insurance costs the following year.”

Trustees pressed staff for more transparency and options. Trustee Shane Haggerty asked why this presentation on employee medical insurance had not been made earlier and urged quarterly reporting; Trustee Catherine Lucero requested clearer documentation of the consultants’ projections and past projection accuracy. Camburn and the consultant acknowledged variability in claims and cited several drivers of recent increases — higher specialty‑drug and pharmacy spend, more high‑cost claimants in the pool, and the return of positions previously funded by ESSER to the general fund.

Specific plan‑cost drivers and program responses discussed

- The presentation named specialty medications and certain diabetes/weight‑loss drugs (GLP‑1 therapies such as Ozempic and Wegovy) among cost drivers. Bebo estimated weight‑loss medications alone cost roughly $450,000 in 2024; staff noted that diabetes indications must be covered per plan therapeutic class rules. - The consultant proposed adding a structured program for employees who access weight‑loss medications — combining medication access with lifestyle and nutritional support; staff said the district could offset some program cost with a $100,000 wellness fund from the vendor and estimated about $143 annual per engaged employee for the program. - Trustees and staff discussed incentives to shift utilization to lower‑cost options (telehealth, mail‑order pharmacy) and possible district seed contributions to employee HSAs for those who choose the high‑deductible option.

Trustee discussion and next steps

Trustees and staff agreed the budget must be adopted on schedule and that health‑plan decisions have a strong effect on the general fund deficit. Camburn said the district will continue to implement identified reductions and bring several items back for board action on June 25 (including the payroll loan and property‑sale items). Staff committed to returning with additional health‑plan options that could temper the immediate impact on employee paychecks, more detailed budget‑to‑actual comparisons for prior projections and health‑plan historical accuracy, and clearer cost models for any alternative proposals.

Ending

The workshop did not include any formal votes. Camburn reiterated that the budget presented was the product of the constraints the board set (no reduction in force, no declaration of financial exigency) and said she would provide the additional detail trustees requested before the June 25 meeting.