AUSTIN, Texas — As a number of Texas school boards move to approve budgets for the upcoming school year, many are having to make sacrifices to move forward with balanced budgets. The extent, however, varies widely, even between neighboring districts.

This week, Manor ISD’s board of trustees voted to approve a balanced budget for the second year in a row. The district found savings by increasing some class sizes, making cuts to transportation, and deferring some HVAC upgrades. Through those cuts, however, the district says it was able to invest an additional $1.1 million in classroom instruction for the upcoming school year. It also added over $250,000 for counseling and social services.

Manor ISD Superintendent Robert Sormani said the district’s tightening budget is a result of increasing costs from inflation and a lack of action from the state legislature.

“Here I am talking about the budget, I’m not talking about helping kids read. I’m not talking about helping kids learn math. I’m not talking about helping kids graduate. That’s not what I’m doing. I’m working with staff and helping them figure out how they’re going to meet the budget,” Sormani said of the additional budget pressure.

Other districts are facing even steeper challenges. In neighboring Austin ISD, the board of trustees is set to vote Thursday night on a budget that includes sweeping cuts in an attempt to close a projected $181 million budget deficit. It includes cuts to the district’s central office, as well as staff on its campuses, like teachers, counselors, and librarians.

Experts argue that external factors like enrollment, recapture payments, and state funding do make a difference when it comes to how districts are able to manage their finances, while responsibility also falls on district leadership to make decisions about facilities, staffing, and long-term planning.

Enrollment trends

“In Texas, funding is largely tied to student attendance and enrollment. And across the state, we have some growing districts, and we have some districts that are enrolling fewer students,” said Rachel S. White, an associate professor of educational leadership and policy at the University of Texas at Austin. “Much of that is attributable to lower birth rates, but then some of it is also attributable to the increase in school choice options.”

Austin ISD’s enrollment continues to fall, while districts like Manor and Georgetown ISDs have seen considerable growth in the last decade.

According to the Texas Tribune School Explorer, which compiles state data, enrollment in AISD fell 17.4% between 2016 and 2024. That downward trend is projected to continue.

Manor ISD’s enrollment increased 11.3% in the same timeframe, while Georgetown ISD’s enrollment increased 27%.

KEYE

Recapture

Recapture payments also contribute to districts’ financial standings.

In Texas, recapture funds are taken from school districts like Austin ISD with excess tax revenue and redistributed through the state’s school funding systems.

In 2025, the Texas Education Agency reported a nearly $771 million recapture payment from Austin ISD, which accounts for over 40% of the district’s revenue. It was the largest recapture payment in the state, according to TEA data.

“In the state of Texas, property-rich districts like Austin send a portion of their local tax revenues that they typically could use back to the state,” White said. “In growing districts that may be less property-rich, they’re sort of on the receiving end of that district.”

Local vs. state responsibility

Despite a funding increase for public schools in 2025, districts argue that the funding was not effective in helping them meet growing costs.

Earlier this month, Jacob Kirksey, an associate professor of education policy at Texas Tech University, explained that decisions at a local level do have an impact on district finances, pointing to Austin ISD’s deficit as the largest in the state.

“There’s been a lot of, I think, deferred actions around budgets that are unique to Austin. But largely, it is an experience that is being felt across districts in Texas,” he said.

In a statement on Wednesday, Austin ISD responded to questions about its budget deficit and what it attributes to its financial woes, writing:

Our budget challenges are due to a number of factors, including near-stagnant state funding, declining attendance and enrollment, property value decline and delayed real estate sales, along with increased spending on academic achievement needs. Recapture also plays a large role in our finances as Austin ISD is the largest contributor to recapture in Texas. While we’re currently working to adjust our budget to reflect the realities of our enrollment and academic needs, these can only do so much when external pressures with property values and state funding also play a large role in our budget process.

Sormani said he is continuing to urge lawmakers to take action to alleviate pressure on public schools.

“One of the things I tell people when I go out in the community and meet with people about expenses, and they say, ‘Well, why are you doing this?’ I’m saying, ‘Look—I’m not doing this to you. If I could, I would take care of this. I am reacting to what your elected officials have created,'” he said.

White said district leadership is accountable, however, for the financial management of their district.

“It is a hard job, but it’s the top position. And as a superintendent, it is your responsibility to figure out the things that do have to be cut, and those things are never easy,” she said. “And it’s not just figuring out what needs to be cut this year to balance the budget, but looking out three years, five years, even 10 years to say, ‘How are we either bringing in more revenue or making sure that we are operating sort of on a lean trajectory?'”