Board adopts 2025-26 budget reflecting another deficit year

HB 2 funding set to cut deficit in half

The Midlothian ISD Board of Trustees voted 6-1 to adopt the district’s 2025-26 budget, approving a fiscal plan that reflects continued cost-cutting measures, maintains a 26:1 student-teacher ratio, and includes a one-year experience compensation plan increase that will be adjusted through mid-year amendments later this fall once House Bill 2 can be fully implemented. The district anticipates the 2025-26 year’s budget deficit to be approximately $6.2 million without the pending state legislation funding appropriations in House Bill 2.

“We are required to adopt our budget by June 30,” said Dr. Rebecca Metzger, Assistant Superintendent of Business and Operations. “We recommend that trustees adopt the fiscal year budget and compensation plan based on current law. Amendments can be considered later once legislative details and guidance for HB 2 are finalized.”

The 2025-26 fiscal year budget was developed to account for a 2% enrollment growth and an increase of just over $1.4 million in inflationary costs in areas like utilities, property casualty and liability insurance, tax costs, and safety and security. The district has also planned for an unexpected 50% reduction in Title I, Part A federal funding and a loss of $1.9 million in SHARS funding ($1.2 million in 2024-25 and $700K in 2025-26).

To address these ongoing budget challenges, MISD implemented a second consecutive year of operational decreases, including:

• Department budget cuts of up to 15% and up to 8% in campus reductions
• The elimination of district-funded AP, SAT and ACT testing fees (families will now assume these costs)
• Reductions in athletic repairs, travel and entry fees
• Less frequent mowing and custodial support, with custodial staff currently responsible for cleaning 7,000 more square feet per person than the national average
• Streamlining ROTC program funding by shifting to a federally supported model

The newly adopted budget does not reflect any legislation initiatives outlined in HB2 that prioritize teacher retention. HB2 revenue is designated for use in five categories - compensation, school safety, special education, a new Allotment for Basic Costs (ABC), and a miscellaneous category that includes a $55 increase to the state’s school funding Basic Allotment. The district has begun to work on implementation plans for HB2, which will take time to complete. 

HB 2 is estimated to provide MISD with about $2.9 million for teacher compensation, $427,000 for non-administrative staff salaries, $1.2 million in revenue from the new ABC allotment, and $1.7 million for student safety, special education, and other areas. This additional revenue could reduce the 2025-26 fiscal year deficit to an estimated $3-4 million.

Looking Ahead

If approved by Texas voters in November, Senate Bill 4 would increase the homestead exemption by $40,000, providing an average annual savings of $431 for MISD homeowners. However, this measure will not increase school funding and was not factored into this year’s adopted budget.

The full board meeting agenda and video can be viewed at: https://midlothianisdtx.new.swagit.com/videos/345820