(C) El Paso Matters.org This story was originally published by El Paso Matters.org and is unaltered. . . . . . . . . . . YISD expects to lose 1,000 students, face $13.9 million budget deficit for coming year [1] ['Claudia Lorena Silva', 'More Claudia Lorena Silva', 'El Paso Matters', '.Wp-Block-Co-Authors-Plus-Coauthors.Is-Layout-Flow', 'Class', 'Wp-Block-Co-Authors-Plus', 'Display Inline', '.Wp-Block-Co-Authors-Plus-Avatar', 'Where Img', 'Height Auto Max-Width'] Date: 2024-05-30 The Ysleta Independent School District is expected to adopt a $404.9 million budget with a $13.9 million deficit for the coming school year as it struggles to keep up with rising costs and more than three decades of declining enrollment – including an estimated 1,000-student loss next school year. Ysleta ISD Superintendent Xavier De La Torre told El Paso Matters the projected deficit for the 2024-’25 school year would be a “worst-case scenario,” depending on enrollment, attendance and other factors. If approved, it would be the third consecutive year that the third-largest school district in El Paso adopts a budget without enough revenue to cover its expenses. The district adopted a budget with a $10.5 million deficit for the 2022-23 school year, which was reduced to $2.5 million by the end of the school year. It also adopted a budget with a $5.7 million deficit for the current school year. Deficits are paid for through the district’s operating reserve. Now, De La Torre said district administration is working on ongoing efforts to increase revenue by ramping up attendance and cutting expenses by eliminating vacant positions. Ysleta ISD Superintendent Xavier De La Torre discusses the district’s budget deficit, Friday, May 24, 2024. De La Torre attributed some of the shortfall to required investments in security and to the statewide loss of federal funds for the School Health and Related Services program. (Corrie Boudreaux/El Paso Matters) “There won’t be any change to those positions that support children and students. Will there be elimination of positions? Yes, if they become vacant and we believe that we can operate without them,” he said. This comes as school districts throughout Texas, including the Socorro and Canutillo school districts, deal with ongoing budget shortfalls after lawmakers failed to pass school funding increases during the 2023 legislative session under a bill tied to a controversial voucher program. The vouchers would have allowed students to attend private schools using state funds. To keep the deficit from growing, De La Torre said his administration recommended not giving employees raises or the $500 stipends they normally receive in the spring and fall, but noted it would ultimately be up to the board of trustees. De La Torre said that offering one stipend would increase the projected deficit to $17 million and giving both would raise it to $21 million. “Obviously, I cannot recommend that,” he said. The Ysleta ISD school board is expected to vote on the 2024-25 budget and compensation plan in mid-June. Unlike neighboring school districts, Ysleta ISD does not have the option of asking voters for a tax increase to help address the deficit, De La Torre said. “Because we have the (optional) homestead exemption, we have always maxed out the tax rate that’s available to us by law, so that cannot go up anymore,” he said. Homeowners within Ysleta ISD’s boundaries can get a 20% homestead exemption on top of the state’s standard $40,000 exemption. If the district cannot find a way to increase revenue or cut expenses, it will need to tap into its reserves to pay for the deficit. The district projects it will have $67.9 million in reserves or enough to keep it running for more than 62 days at the end of the 2023-24 school year, Lynly Leeper, Ysleta ISD’s chief financial and operations officer, said during a May school board meeting. Learn more How do El Paso school districts set their budget? 7 things to know & how to get involved Every summer, school districts across Texas, including El Paso, prepare their budgets for the upcoming school year. Here’s what you need to know and why it matters. If the upcoming budget is approved as planned, the reserve balance will be $54 million, or 54 days, after the 2024-’25 school year, she said. If costs stay the same and the district doesn’t receive additional funding, Leeper said its reserves could decrease to $26.1 million by the end of the 2026-’27 school year, leaving the district with enough funds to operate for 29 days. The Ysleta Independent School District board of trustees just extended the contract of its superintendent. (Courtesy: YISD) Ysleta ISD policy requires the district to have enough money in its reserves to cover from 10 to 15% of next year’s operating expenditures. Though the state does not have requirements on how much a school district should have in reserves, they need to have enough to keep running for at least 75 days to get an A in the Financial Integrity Rating System of Texas. What caused YISD’s deficit? Ysleta ISD’s deficit was caused by several factors including increased costs for school security, inflation, stagnant state funding and decades of falling enrollment. De La Torre said the district has seen a pattern of declining enrollment since 1987. The district is in a landlocked area of El Paso that has seen little new development in recent decades. The population living in the district has been aging, and the number of children born in the district has declined steadily. In 1996, YISD had more than 47,300 students enrolled in the district, according to a Texas School Performance Review published in 1997. By the 2014-15 school year, enrollment dropped to just over 43,000 students. Now, the district has about 34,900 students during the 2023-24 school year, according to data from the Texas Education Agency. School funding from the state is calculated using a formula based on enrollment, attendance and other factors. As a school district’s enrollment declines, so does the funding that it receives from the state. De La Torre said enrollment loss increased significantly after the COVID-19 pandemic. “We used to lose 200 students, 500 students a year. All of a sudden we’re losing 1,000 students, 1,200 students,” he said. “So we’re building a budget expecting we’re losing over 1,000 students. We hope that doesn’t happen.” Data shows Ysleta ISD’s enrollment could have had even sharper declines if it wasn’t for its efforts to enroll students from surrounding areas. Ysleta ISD is the only one of the nine traditional school districts in El Paso County that is bringing in more students from other school districts than it is losing to charter schools and other districts, according to TEA data. Most came from Socorro ISD. This school year, one in every 10 students attending an Ysleta ISD school lives in the Socorro ISD boundaries. Even with decades of falling enrollment, De La Torre said the district has remained “economically sound” by gradually downsizing and limiting expenses to the bare minimum while maintaining the quality of education. Throughout the years, the district closed 15 campuses as part of the 2015 and 2019 bond programs and went from 65 to 49 schools. As enrollment is expected to continue declining, De La Torre said the district may need to close more schools in the future, but did not specify which ones. “Anytime that we decide to close a school and consolidate, we want to get out to talk to the community,” De La Torre said. “What I will tell you is it isn’t being closed for financial reasons.” Inflation is another factor that has contributed to the district’s deficit. Though inflation has increased roughly 20% in the last four years, Leeper said during the May meeting that there has been no increase in school funding from the state since 2019. School districts are also seeing an increased cost in security requirements after a Texas law that requires all schools to have an armed officer on campus went into effect this school year. “The armed officer would be provided with sidearms, rifles, vests, vehicles and motorcycles, and then (the state sends) $700,000 but the bill is $2.7 million,” De La Torre said. Additionally, a statewide reduction in School and Health Related Services — or SHARS — funding has also made it harder for the district to cover all its expenses. SHARS is a program that uses Medicaid funding to reimburse school districts for services such as counseling, physical therapy and specialized transportation, among others. Now schools across Texas won’t be getting those funds after the Texas Health and Human Services lost its appeal of a 2017 audit from the Office of Inspector General which found the state incorrectly reported reimbursements. De La Torre said he expects this year’s actual end-of-year deficit to grow from $5.7 million to $6 million because of the reduction. 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