SCUCISD trustees hear budget workshop on House Bill 2, teacher raises, and possible tax election

Schertz-Cibolo-Universal City Independent School District leaders told trustees that a state-level compromise on House Bill 2 will change how districts receive and distribute funding but will not fully close the district’s structural deficit.

Superintendent Maloney and Chief Financial Officer (CFO) Mr. Desmoy presented updated revenue and expenditure projections after a late change in the legislation. They described a mandated, state-funded raise of $2,500 for classroom teachers with three to four years’ experience and $5,000 for teachers with five or more years; the funding will be passed through by the state but does not cover all employee groups the district currently treats as teachers for pay-scale purposes. The presenters said the bill creates a new “allotment for basic costs” (referred to in the presentation as the ABC) intended to help cover inflationary costs such as property insurance, health care and fuel; the district used a $105 per-student figure in its slides.

District staff explained how the state-defined term “classroom teacher” (described in the meeting as a definition in Chapter 5 of the Education Code) excludes some staff the district currently pays on the teacher salary scale — such as certain librarians, instructional coaches and other certified staff — so many employees who have been on the teacher scale will not receive the state-mandated raise unless the district decides to extend additional local funds to them. Staff estimated more than 100 teachers and librarians and about 17 nurses could be excluded from the mandated raise under the state’s definition; the district will develop compensation scenarios to provide equitable adjustments where possible.

CFO Desmoy presented the district’s starting projection before legislative adjustments: roughly $152.5 million in revenue and just under $159 million in expenditures, a starting operating deficit of about $6.4 million before accounting for new ongoing cost increases. Staff identified roughly $3.8 million in increased ongoing costs (insurance, stipend reclasses, and other items) and about $5 million in prioritized one-time needs, resulting in a modeled potential deficit near $10.5 million under current assumptions.

The presentation outlined available local options to raise revenue, including a Tax Ratification Election (TRE) or voter-approval tax rate (VATRE) that could seek up to 12 pennies (three “golden” pennies and nine “copper” pennies) of additional maintenance-and-operations tax rate. Staff estimated that levying all 12 pennies could raise roughly $16–16.5 million in year one, while the three golden pennies are estimated to yield approximately $8.2–8.3 million with a larger state match; copper pennies receive a smaller state match. The presenters warned that constitutional and statutory changes (referenced as Senate Bill 4 and other bills) increasing the homestead exemption will reduce taxable values locally and therefore decrease the per‑penny value of those levies.

The board discussed three illustrative tax-rate scenarios: maintaining the current interest and sinking (I&S) rate, reducing the I&S rate to preserve state aid, or lowering rates substantially with the tradeoff of reduced state aid. Staff emphasized that state formulas and “hold harmless” language affect how much state aid a district receives when it changes its local levy and that some aspects of the final legislation were still being clarified at the time of the presentation.

Trustees and staff outlined next steps: staff will form a cost-driver committee that will include central office staff, principals, teachers and parents to review major, recurring cost drivers and propose efficiency measures; staff will present compensation scenarios and prioritized one-time project lists (deferred maintenance, band instruments, buses, CTE equipment, safety systems) before any voter proposition; and staff aimed to have initial compensation recommendations ready for the June 10 budget workshop. The presenters cautioned that any one-time spending tied to a TRE should be prioritized and that recurring salary commitments must be considered carefully because they continue beyond the first year.

No board vote was taken on revenue measures during the workshop; trustees directed staff to continue modeling scenarios and to return with specific compensation and spending recommendations and a prioritized list of one-time projects for public review prior to any election.