EL PASO, Texas (KTSM) — Texas Gov. Greg Abbott criticized the El Paso Independent School District’s financial situation during a visit to El Paso on Wednesday, Aug. 19, saying the district’s finances had “spiraled out of control.”

“Problems have arisen in the Austin Independent School District as well as in the El Paso Independent School District. They show how financial problems can spiral out of control,” Abbott said.

Abbott said from 2015 to 2025, El Paso ISD’s enrollment declined by around 20 percent, but at the same time, administrative spending per student increased by 100 percent.

Funding for school districts is based on daily attendance, and Abbott said people in charge of budgets should have been tracking the decline in attendance to help them form a more accurate budget.

“Recent internal audits identified tens of millions of dollars in financial inefficiencies tied to underestimated expenses, unrealistic budget assumptions, and poor financial oversight. Listen, El Paso and Austin, those school districts are in contrast to what we see in other school districts across the state,” Abbott said.

According to a report by the Texas Tribune, the state saw its first non-pandemic enrollment decline in 40 years, noting that 76,000 fewer students enrolled in public schools in 2026.

Under a new proposal by the governor, school districts would be required to spend 70 percent of their funding in the classroom, rather than administrative.

 Abbott addresses school efficiency, taxpayer dollars in El Paso 

“Simply put, too many tax dollars for schools are funding things that do not improve student outcomes,” Abbott said.

In June 2025, EPISD paid over $347,000 for former superintendent Diana Sayavedra’s voluntary retirement agreement. In Nov. 2020, the district paid over $550,000 to former superintendent Juan Cabrera in his resignation agreement.

 EPISD to pay Sayavedra $347K as part of voluntary retirement agreement 

EPISD’s Superintendent Brian Lusk addressed the governor’s remarks with the following statement:

“At El Paso ISD, the classroom is the center of our universe, and we prioritize directing all resources possible to support instruction. We acknowledge that El Paso ISD had too many central office positions and over the last several years the district was not right-sized to align with enrollment trends. Since I joined as Superintendent, we have taken a close look at every central office position and made significant reductions to ensure staffing reflects the needs of the district. That work will continue because, as highlighted by El Paso ISD’s 2026 TEA accountability rating of B and a 2-point increase from last year, when our teachers and students have the right resources, they succeed.”

 TEA grades El Paso schools, districts for 2026 

In an interview with KTSM 9 News in July, Lusk said the district was in “a very strong financial position,” and enrollment looked good.

“It’s a new day at EPISD. We did have financial challenges; those days are behind us, and we’ll make sure those mistakes won’t happen again,” Lusk told KTSM News Anchor Andy Morgan.

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