All but three of San Antonio’s public school districts will likely be operating in the red again this school year.
According to a review of financial reports and public discussions for a dozen school districts this summer, the vast majority are cutting expenses left and right for the 2026-27 school year. Administrators say budget cuts are tied to Texas putting more constraints on how districts can use state funds and collect local property taxes.
Most districts are also bracing for the loss of students, with most projecting student counts dropping from the previous year as Texas’ new school voucher-like program goes into effect, paying for more 8,000 local students to attend private institutions.
Anthony Jarrett, superintendent of San Antonio’s second-largest district North East ISD, said enrollment is the district’s biggest challenge.
“This past year we lost over 1,000 kiddos that we thought were going to be in our schools,” he said during a June interview. “But our teachers had already signed a contract, and what that does is it holds us accountable to still have to keep staff on the payroll, which then creates a greater deficit.”
Compared to reports from neighboring districts, NEISD is expecting the largest student enrollment hit, budgeting to have 2,600 fewer students for the upcoming 2026-27 school year. NEISD served around 55,000 students last year.
On paper, NEISD also faces the largest budget deficit in San Antonio: over $50 million, but district officials say it will be closer to $20 million after getting pending payments from the state.
Here is how other San Antonio districts compare in terms of budgets and funding deficits as they head into the 2026-27 school year.
Role of student enrollment
Texas recently reported the biggest drop in public school enrollment during the 2025-26 school year. San Antonio wasn’t immune.
San Antonio ISD could lose 1,452 students for the upcoming school year. Northside ISD could lose 2,159. Smaller districts like South San Antonio ISD, Edgewood ISD and Harlandale ISD also anticipate enrollment dips.
In a state where public school funding is based on enrollment and attendance rates, more students usually translates to more money.
Last year, districts like SAISD and NEISD lost more students than they anticipated, resulting in overstaffing and slowed progress on dealing with deficits.
But school districts expected to grow are also struggling to balance budgets.
Southwest ISD and East Central ISD are two districts with growing enrollment in tandem with development booms, yet both anticipate budget deficits because of rising costs and an increasing number of state mandates.
Serving roughly 12,000 students, East Central ISD expects to have around 600 more students this upcoming school year. Even with the boom, ECISD projects a $7.5 million deficit.
Southside ISD, which serves a little over 6,000, expects to get at least 100 additional students this year. Officials say the budget would have to shrink to sidestep a deficit. Last year’s budget was $73.5 million compared to the proposed 2026-27 budget of $72 million, which the school board still has to approve.
“I think it’s going to be difficult to reduce that far down — the $1.5 million,” said Chief Financial Officer Michael Carrales, during a June budget presentation. Those cuts would likely be made by eliminating positions through attrition and a “strategic” use of federal money to offset the district’s general fund.
Where are districts cutting?
While districts are trying to make up for fewer students by investing in school choice programs and marketing, increasing enrollment in San Antonio’s urban districts is unlikely.
Many of the inner-city districts are deploying hiring freezes and eliminating positions.
As part of Judson’s 2026-27 budget plan, officials cut 7% from all employee categories translating to over 500 positions, most of which they said were empty, nearly eliminating the district’s $35 million deficit.
At other districts, staffing reallocations have been a little more targeted. SAISD recently cut 224 positions, a quarter of which were layoffs. District officials said they were targeting positions not directly tied to student outcomes: vacant police positions, customer service, admin jobs and custodians.
Alamo Heights ISD, located mostly in the wealthy city of Alamo Heights, is one of the few districts with consistent enrollment. It was able to balance its budget by making similar cuts to staffing over the past two academic years.
Most districts are also freezing pay, with some offering retention bonuses. NEISD is offering teachers bonuses based on student enrollment.
Edgewood ISD, which recently adopted a $3.7 million deficit, is the only district offering pay increases for all staff for the upcoming school year.
Asking taxpayers for more
Even after careful budget planning, school districts with deficits and surpluses alike could ask voters for extra cash during election season this November.
South San ISD, which has a small budget surplus of $1.6 million, is going out for a voter approval tax rate election, or VATRE, which would move 7 cents from its interest and sinking rate, which pays for bond projects, to its maintenance and operations rate that covers day-to-day costs, like employee pay, student programs and utilities. If voters agree, the election could unlock an extra $6 million to $8 million a year for the district.
Last year, several area-districts went out for VATREs that voters rejected, including at Judson ISD, ECISD and Schertz-Cibolo-Universal City ISD.
A year later, those same districts are considering going to voters again in November, with more districts like NISD and SAISD jumping on board. School boards still have to green light putting something on the ballot, so the public won’t know which districts are officially going for a tax election until sometime in August.
If voters say yes to these potential tax changes, district officials say they could close budget gaps, provide pay raises, support student programs like fine arts, and cover other day-to-day costs. Otherwise, they would have to consider school closures and more budget cuts.
Bracing for more state mandates
Looming large above the budget planning madness is the state’s next legislative session, which starts in January.
The 89th Texas Legislative Session in 2025 resulted in a slew of education policies public schools are still wrapping their heads around, including the passage of school vouchers, which could hurt public school enrollment, and House Bill 2, a massive public education funding bill that mandated teacher raises but left little flexibility for school districts to use state funding in other critical areas.
State officials also increased property tax relief, cutting into what school districts can collect from local property taxes, an issue exacerbated by market values in Bexar County that stayed largely flat.
Schools are still trying to fund other state mandates passed in previous years related to school safety such as the requirement of three-point seat belts on school buses and uniformed officers on campuses. Some mandates were only partially funded by the state, while others were not funded at all.
Now, school districts are bracing for the next round of state legislation, which may trigger even more mandates, tax exemptions or changes to public school funding.
“We probably don’t expect miracles coming out of there, “ said Carrales from Southside ISD. “But if we could hold the line for this second year of the biennium… we could end the year with conservative budget and see if anything actually happened for the 2027-28 school year.”
