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How Socorro ISD’s financial picture got so bad it needed to lay off 300 people [1]
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Date: 2025-02-24
About 300 Socorro ISD employees will be laid off in the coming weeks, the starkest of a number of actions the school board approved Wednesday to cut $38 million from next year’s budget.
Socorro’s dire financial situation – officials said the district would be insolvent next year without the steep cuts – has a number of causes. But the primary cause is simple: The district has been spending more money than it takes in for a decade. And each year in that time, the Socorro ISD board voted to knowingly spend more than it was taking in, according to a presentation the school board received during the meeting.
The Socorro school board last adopted a balanced budget – meaning it planned to take in as much or more money than it spent – in 2015.
Every year since, the school board has voted to spend more money than it expected to take in. Even with the cuts approved last week, the developing 2025-26 school year budget still has an $8 million deficit.
In 2020 and 2022, the district ended with surplus, because of savings from school closings during the pandemic in 2020 and one-time federal COVID funding in 2022, Socorro ISD Chief Financial Officer David Solis told the school board at its meeting Wednesday. But in the other years, SISD finished the year with deficits.
READ MORE: Socorro ISD board approves plan to lay off about 300 employees
The biggest deficit was in fiscal year 2024, when the board adopted a budget with a $15 million deficit and finished the year more than $50 million in the red.
Solis – who joined the district in November – said the district’s budget for the 2023-24 school year projected an increase of 700 students. Instead, enrollment declined.
The board and district made other decisions that year that added to the deficit, he said.
The district dipped into its reserves that year to spend $4.3 million to develop specialized academies, $6.4 million to replace turf at athletic fields, $1.5 million for a parking lot at Montwood High School, $12 million for pay raises, and $6 million for a one-time $1,000 retention stipend for employees. Those steps added about $30 million to the deficit.
The deficits are in what is known as the maintenance and operations budget, which funds the day-to-day operations of schools. The deficits do not include projects paid by bond issues, such as the $59.8 million sports stadium the district opened last year at the Student Activities Complex. That project, and other general obligation bond issues, were approved by voters and are funded by a dedicated tax stream separate from maintenance and operations.
Solis and other speakers Wednesday repeatedly reminded the audience that the state has not increased the basic allotment per student – a little over $6,000 – since 2019, even as inflation escalated costs for schools over the years.
But an El Paso Matters analysis shows that while the state’s basic allotment – which provides the largest chunk of money for Texas schools – hasn’t grown since 2019, Socorro’s per-student expenditures continued to grow, largely by tapping into the district’s fund balance, or savings account.
All El Paso County school districts are facing financial challenges because of factors like declining enrollment and stagnant state funding.
RELATED: YISD considers $25M loan for payroll gap
But Socorro’s situation is uniquely dire because of decisions to continually eat into its fund balance to pay for not just one-time expenses – the usual reason for dipping into savings – but for ongoing expenses like payroll.
Socorro’s fund balance has essentially been vaporized in the last three years.
Socorro ISD’s policy calls for it to have enough money in its fund balance to operate for 75 days; at the end of this school year it’s expected to be at about 24 days, officials said.
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[1] Url:
https://elpasomatters.org/2025/02/24/socorro-isd-budget-crisis-layoffs/
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