Del Valle ISD outlines budget squeeze: $13 million deficit, enrollment estimates and proposed raises hinge on state bills

Del Valle ISD officials told the Board of Trustees that the district faces a multi-million-dollar budget gap but is refining assumptions as the Texas Legislature considers school finance bills.

Chief Financial Officer Dina Edgar presented the monthly financial report and an updated budget outlook for the 2025–26 school year. Edgar said the district initially identified an approximate $13,000,000 deficit that administration has reduced to about $10,000,000 after updated property valuations and other adjustments. She described two budget scenarios: one under current law that would require using $2.5 million in fund balance and a second under House Bill 2 that would provide additional state funding and allow a 3% raise for all staff without using fund balance.

Edgar reviewed key assumptions: a demographer-projected average daily attendance of 11,931 (a projected increase of about 200 students from the October PEIMS snapshot), a roughly 20% increase in property values that shifted the district back into a recapture footing under current law, and healthcare and insurance cost estimates pending June 9 premium notices. "A $13,000,000 deficit doesn't happen overnight. It's years in the making that results in what I have inherited as a superintendent of schools," Superintendent Dr. Gutierrez said, thanking Edgar and noting the district's fiscal adjustments.

Edgar outlined compensation scenarios: under current law the draft budget proposes a 2% raise for teachers, librarians and nurses and 1.5% for other staff; under House Bill 2 the district could afford a 3% across-the-board increase. Edgar said payroll represents about 89% of the district’s expenditures in the draft and that the proposed budget includes nearly $13,000,000 in reductions and $1,000,000 for new positions to address growth.

Trustees asked technical questions about HB2's 40% compensation requirement and the mechanics of potential reimbursements from House Bill 500 to offset earlier Medicaid reimbursement losses. Trustee Franco asked for more granular calculations; Edgar offered to provide the funding-formula templates and promised follow-up detail.

The board also received standard procurement updates and reports: a bank depository RFP received one responder (Wells Fargo), a food-service management RFP will be scored by May 21 with a vendor recommendation expected in June, and a fuel RFP for bulk unleaded and diesel anticipates proposals through May 16 with award recommendations in June.

As required by state law, the board voted to call a public budget hearing and meeting to consider adoption at 6:15 p.m. in June (the motion stated "06:15PM on June 2025" as read into the record). President Wagner moved the meeting call; Vice President Ladesma Woody seconded and the motion passed 6-0.

Edgar closed by noting several unknowns that could change the final numbers before budget adoption: pending legislative action, finalized healthcare premiums, the district's chapter 313/Tesla payment projections and possible tax-compression changes tied to statewide proposals.

District staff said the official budget and truth-in-taxation notices will follow the timeline required by the Texas Education Code and that the board will hold a public hearing on the proposed budget before adopting a final budget and tax rate prior to the June 30 statutory deadline.

The board did not adopt a final budget at the meeting; it scheduled the public hearing and directed staff to provide updated calculations as legislative action becomes clearer.