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Brazosport ISD CFO outlines budget shortfall, temporary improvement from one-time revenues; warns of future deficits
Summary
District staff reported an adopted $11.7 million deficit for 2024–25 but projected the current-year shortfall to narrow to about $5.6 million because of higher-than-budgeted Chapter 313 reimbursements and tax-credit reimbursements; long-term deficits remain a risk absent legislative changes or enrollment growth.
Brazosport ISD’s finance staff told trustees the district faces a multi-year budget challenge driven by inflation, static state per-student funding and declining refined average daily attendance (ADA). The board received an update showing an adopted deficit budget of $11.7 million for 2024–25; updated revenues from tax‑credit reimbursements and Chapter 313-type supplemental payments have reduced the projected deficit for the current year to roughly $5.6 million and pushed the projected ending fund balance near the district’s optimum level for 2024–25.
The presentation explained key drivers: a decline in refined ADA (used for state funding calculations) since the pandemic that reduced state revenue; the state basic allotment has not increased in several years while local inflation and payroll costs have risen; and Chapter 313 and similar agreements have provided material but variable local revenue that is scheduled to phase out as agreements expire. CFO staff said the district budget assumes continued Chapter 313 receipts this year (actuals exceeded budgeted amounts), but those revenues are not guaranteed long term and the JEDI transition will reduce such supplements in future years.
Specific figures presented: the district adopted a 2024–25 budget showing $118.9 million in available revenue and $130.6 million in expenditures, a planned $11.7 million deficit and a projected ending fund balance of about $31.9 million (roughly $6 million below the TEA‑recommended optimum). After updated receipts (tax‑credit reimbursements and supplemental payments), projected current-year revenues rose to about $125 million and the near‑term deficit shrank to about $5.6 million, restoring the projected ending fund balance near the $38 million optimum. However, under current assumptions the district projected a $12.6 million deficit in 2025–26 and warned that fund balance depletion could occur by 2027–28 if revenue and enrollment trends continue unchanged.
CFO staff outlined legislative priorities the district will pursue at the state level: indexing the basic allotment to inflation, converting funding to an enrollment‑based model rather than ADA, increasing special education and school safety allotments, supporting teacher apprenticeship funding, clarifying bond ballot language, and creating a coastal insurance index to address higher premiums for coastal districts.
Trustees asked about the variability of supplemental payments, the mechanics of refined ADA versus enrollment for funding, and the timeline for district budget workshops and adoption. Administration said the budget process will continue through August with a compensation report in May and annual budget adoption target in August.
Trustees and administrators cautioned that absent structural changes to state funding or meaningful enrollment growth, the district will need to identify reductions or new revenues to avoid long-term fund balance depletion.
