Raising the tax rate? Cutting the homestead exemption?
Both possibilities were discussed -- and not outright dismissed -- as Houston ISD trustees bleakly considered the ramifications for HISD in wake of the Houston budget filed Wednesday calling for a $10 billion cut over two years in the Foundation School Program.
"These are in fact turbulent times in funding in Texas right now," Superintendent Terry Grier announced at today's school board workshop, telling Houston ISD trustees: "Don't make too many promises about what we're going to keep and what we're not."
He promised that the reduced budget circumstances in the maintenance and operations part of the Foundation School Program would lead school board officials to eliminate "things you never thought you'd consider eliminating."
Preceded by a discussion of possible changes in the magnet school program that Grier tried to bring to a close sooner than Houston ISD trustees wanted, the review of numbers didn't have too many positive points.
There are three ways the state can manage the cuts and Moak, Casey & Associates worked up projections of what this would mean for several districts including Houston. (See below for their list.)
If the Legislature eliminates what's called the Additional State Aid for Tax Reduction (ASATR), "they will also need to reduce the basic allotment and equalized wealth level," according to HISD documents. HISD's state funds would be cut $321,265,092 per year "compared to what current law formulas would fund next year."
Things get worse if the state prorates the cuts for all districts since HISD -- which has a high number of low-income children -- is a property-rich district. Under this method HISD would lose $348,155,369 per year.
Things get better -- though still not grand -- if Texas legislators approve a flat 15 percent reduction. Then HISD would lose $202,786,293 per year. But what's best for HISD is worse for other districts.
Still to come is the Senate's appropriation bill.
Chief Financial Officer Melinda Garrett also pointed out that the $10 billion cut is "only one of several sources of money" the district gets from the state. For instance, the state has zeroed out all the state grants totaling $32 million. HISD gets money from this pot to help pay for pre-K, for instance. The pre-K program would not be shut down -- there will still be money for it -- but it might have to move back to half-day status.
Other funding for such things as supplemental tutoring services and an optional extended year have been eliminated, she said.
Garrett did point out that this is still the early stages of predicting the cuts and said that "everybody knows" these aren't the final numbers. But it gives HISD and other districts a starting point, she said.
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"From now on, things that happen to that bill will be things introduced as adjustments," she said.
Trustee Carol Mims Galloway asked if there was any way for the district to generate revenue and Garrett told her they are in final negotiations on a contract to put advertising on school buses.
Grier said the state has also discussed delaying payments to school districts for up to two months, which could save it millions of dollars.