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Round Rock ISD projects $1.1 million operating shortfall after midyear updates; administrators list cost controls
Summary
Finance staff reported a midyear update showing revenues up slightly but expenses rising more, creating a projected $1.1 million deficit; district officials outlined hiring freezes, expense monitoring and use of planned Cypress property sale to protect fund balance.
Dennis Covington, chief financial and chief operations officer for Round Rock ISD, presented a second six-week budget update for fiscal 2024–25 to the board, reporting a projected operating deficit of about $1.1 million after midyear adjustments.
Key figures and drivers: Covington said tax collections increased over the estimate by roughly $3.6 million, which reduced state revenue by about $773,000 under the state’s funding formula. On the expense side, higher-than-expected enrollment required hiring about 45 additional teachers at roughly $3.1 million, and an enrollment incentive payout rose from an estimated $3.3 million to $3.5 million. Other increased allocations included $619,000 for retiree payouts, plus smaller contract increases. Total expenses rose about $4.0 million compared with the November update.
Why it matters: With revenues rising by about $2.8 million and expenses rising by roughly $4.0 million, Covington said the maintenance and operations fund now shows a projected shortfall of approximately $1.1 million. The district still expects to close the Cypress property sale in March and projected overall surplus (including that sale) near $8.2 million, but staff said they are not counting the sale toward balancing operating results until closed.
Planned controls: Covington listed management actions under consideration to restore balance, including freezing non–mission-critical vacant positions, restricting overtime, monitoring substitute and guest-education expenses, reducing nonessential department operating costs, reviewing vacation payout exposure and maximizing capital and grant reimbursements (so bond or grant funding, not operating funds, pay eligible items).
Trustee questions and fund balance concerns: Trustees asked for clarity on why current-year tax collections were lower in the update (Covington said the property value study changed the projection, not uncollected taxes) and pressed staff about long-term fund balance strategy. Trustees requested a future budget update that explicitly lists the candidate controls administrators referenced so the board may consider them before March decisions.
Next steps: Staff said they will provide a follow-up budget slide listing the proposed controls, continue monitoring through spring and return with updates to show how the district can finish the year in a balanced position without tapping the fund balance unnecessarily.
