Santa Fe ISD adopts 2025–26 budget; tax rate left preliminary amid state funding changes

The SANTA FE ISD Board of Trustees adopted the district's 2025'26 general fund, nutrition services and debt-service budgets at its June 16 meeting after a public hearing on the proposed budget and preliminary tax rate.

The hearing and subsequent discussion focused on how House Bill 2 and new state homestead exemptions change the district's revenue calculations, teacher pay mandates and timing of state reimbursements. Board members approved the budgets as presented and approved several related contracts and financial actions during the regular agenda; the board did not adopt a final tax rate and will return to that decision once final property valuations and state guidance are available.

District finance staff opened the hearing explaining the legal requirement to adopt a budget and outlining revenue assumptions. "As you know, by section 44.004, the Texas Education Code, we are required by law to adopt a budget prior to the first year of the new fiscal year," said Mr. Sanchez (staff member). He told trustees the presentation reflected months of internal modeling and recent changes tied to House Bill 2.

The district's presentation said state changes increased homestead exemptions and tightened "compression" in the funding formula, reducing local collections and requiring the district to model several exemptions. "The state has promised to make up that cost and send that directly to us. However, we have not seen any of that yet," Mr. Sanchez said. He cautioned the district must wait for guidance and implementation rulings from the Texas Education Agency before some calculations can be finalized.

Trustees pressed staff on the timing and sizing of state…