Austin/ Politics & Govt
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Published on June 21, 2024
Austin ISD Approves $954 Million Budget with $78 Million Shortfall, Eyes VATRE to Offset DeficitSource: Larry D. Moore, CC BY 4.0, via Wikimedia Commons

Amidst financial strain, the Austin Independent School District (AISD) has confirmed a budget of $954 million for the 2024-25 academic year, a move that projects a $78 million deficit unless a Voter-Approval Tax Rate Election (VATRE) passes, as reported by KVUE. Taxpayers in Austin generated over $1.69 billion in revenue for the school's upcoming fiscal period, but a substantial amount, approximately $821 million will be funneled into Texas's recapture program, which aims to balance the scales among the state's school districts. Austin ISD stands out as the largest contributor to this program.

The district is battling with limited funding options and a state funding formula that has not seen revisions since 2019, consequently, they are facing a dilemma where full-time employees might not see a pay increase, receiving only a one-time incentive payment of $500, unless fiscal relief is obtained through a VATRE or alternative revenue streams, according to KVUE. Last year's 7% raise set expectations high in place of anticipated state funding which did not materialize.

Details on the budget were discussed at length during a recent AISD meeting. Austin ISD CFO, Ed Ramos shared insights on the tight economic spot the district finds itself, highlighting the possible repercussions on educational quality and staffing without state funding increases. "Without an increase in funding for public education, without an increase to the basic allotment not only will you see additional reductions that will impact the classroom you will see that state wide," Ramos said, as stated by KXAN.

While the VATRE could offer some solace, it would entail, a tax burden on homeowners. For a residence valued at around $563,000 the monthly tax increase averages about $35, Ramos pointed out. Failure to pass the VATRE might plunge the district into a deeper fiscal abyss, facing a shortfall of $78 million. "Then we would be looking at a $78 million shortfall," Ramos told KXAN. To chip away at the projected deficit, the district has already identified and enacted $29 million in reductions, affecting central staff positions, contracts, and software.