Why HISD is offering lower staff raises than other districts

As several Texas school districts have implemented raises approaching or exceeding 10 percent this month, many Houston ISD employees are questioning why their district’s offer — 3.5 percent to 5 percent salary increases for nearly all staff — pales in comparison.

The short answer: HISD benefited less from school finance reform than some other districts.

A Houston Chronicle analysis of school district budgets shows HISD did not reap major rewards from lawmakers’ $6.5 billion infusion into Texas public schools this spring. HISD officials projected the district’s net benefit from school finance reform at $135 million, equivalent to roughly 6 percent of the district’s general fund revenue.

By comparison, each of the districts offering the region’s largest raises to date — Alief, Humble and Sheldon — project net benefits from school finance reform that exceed 10 percent of their general fund revenues. Teachers in those districts will see salary increases ranging from about 7 percent to 15 percent.

Other districts that did not reap relatively large benefits from school finance reform, including Conroe, Katy and Spring ISDs, have approved compensation packages similar to HISD’s recommended proposal.

Several factors impact each district’s net benefit from the new law, including student poverty levels, projected enrollment and “recapture” status. “Recapture,” which HISD pays, is the state’s method of creating funding equity between districts by shifting money from property-rich districts to poorer ones.

With its projected $135 million, HISD administrators have recommended dividing the money three ways: $57 million to increase employee compensation, $42 million to meet state spending requirements for instructional programs and $36 million to close a projected budget deficit.

HISD’s deficit stems from multiple rising costs — including health insurance and support for the district’s neediest students — outpacing increases in district revenue. The district could eliminate jobs, reduce salaries or trim non-payroll costs, but administrators have not recommended significant spending cuts.

Barring a last-minute overhaul to its recommended budget, which must be approved by June 30, HISD’s base teacher salaries will remain among the lowest in the region, with first-year teachers earning $54,368.

“We’ll bring back a recommendation that we know, as an administration, keeps the district fiscally sound,” HISD Interim Superintendent Grenita Lathan said. “But at the end of the day, I also have to look at options for all employees. I think that’s only fair.”