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Prosper ISD finance staff warn of widening deficits, outline $25M–$28.4M shortfall and cost‑cutting steps
Summary
At its July 20 meeting the Prosper ISD Board heard a budget presentation from district finance staff who said state funding trends and local recapture pressures leave the district managing a multimillion‑dollar deficit and pursuing department cuts, contract audits and a travel freeze to protect campuses.
At a July 20 board meeting, Prosper ISD finance presenter Miss Croix told trustees that both state and local funding dynamics are pushing the district into larger shortfalls and that the district is already taking steps to reduce costs.
“Sixty‑three percent of school districts we pulled are expected to adopt a deficit budget this year,” Miss Croix said, citing research from the Kinder Institute at Rice University to place Prosper ISD’s shortfall in a statewide context. She said the district adopted a $25,000,000 deficit last month and is now projecting a roughly $28,400,000 deficit for 2027–28 with no additional raises included.
Miss Croix explained several drivers behind the shortfall: the state basic allotment has not kept pace with inflation since 2019, new state funding in House Bill 2 included large amounts targeted to teacher pay and fixed costs rather than general per‑pupil funding, and rising local property values trigger recapture payments to the state. She said the district currently expects to send about $2,500,000 in recapture this year and projected that could grow to about $6,500,000 as values rise.
At the local level, Miss Croix outlined actions the district is already taking to reduce expenditures while trying to shield campuses. Those steps include asking departments to identify additional reductions (she said departments previously cut about 20% and were asked to cut another 10%), implementing a central‑office travel freeze (case‑by‑case exceptions for campus or student travel), conducting a contract audit to identify potential savings, pausing backfills for certain central positions, and auditing vacancies before deciding whether to refill them.
Miss Croix walked trustees through budget composition: roughly 60.54% of the adopted budget is instruction and about four out of every five dollars is payroll. She emphasized that fixed costs—utilities, insurance and transportation—do not decline when attendance dips and that school finance formulas based on attendance rather than enrollment magnify the district’s revenue volatility.
On timing and next steps, Miss Croix said the district expects its final audit in August, will hold a tax rate adoption hearing next month and plans to return with a budget amendment after certified property values and more enrollment data are available. “We adopted a $25,000,000 deficit last month. I will be coming to you in August or September with a budget amendment once we get our certified values and we get some better enrollment numbers,” she said.
Trustees commended finance and department leaders for identifying immediate savings while expressing the difficulty of cuts that protect campuses. The board did not take formal budget action at the July 20 meeting; the district said it will present amendments after final values are certified.
