Pasadena ISD board approves notice to shift fiscal year to July, narrows transition-year deficit

The Pasadena Independent School District Board of Trustees on April 23 approved notifying the Texas Education Agency of the district’s intent to change its fiscal year start date from Sept. 1 to July 1, effective July 1, 2025. Board members and staff framed the move as a timing strategy that would reduce a one‑time transition‑year budget gap.

Dr. Pal and district finance staff reviewed two draft budget scenarios: one under the current September–August fiscal calendar showing an approximate $37 million deficit for 2024–25, and a transition-year model that would reduce the gap to about $6.8 million by recognizing 12 months of revenue while accounting for only 10 months of expenditures in the shortened fiscal year. Staff emphasized this is a timing adjustment for the transition year; the subsequent year would return to a standard 12‑month revenue and expenditure cycle.

Trustees and staff also discussed other measures to close ongoing shortfalls, including identifying roughly 150 position lines for potential elimination through attrition, districtwide 3% reductions in department budgets and continuing searches for additional revenue opportunities. Staff noted federal ESSER pandemic funds that have helped the district will expire in September and that the district has authorization to levy 1.22 “disaster pennies” tied to the January 2023 tornado, which staff estimated could generate about $2.3 million in additional revenue.

Trustees asked how neighboring districts are handling raises and deficits; staff cited a range of preliminary proposals among peer districts (example figures mentioned during the meeting included 2%–3.5% offsets or flat payments funded from fund balance). The board voted in favor of the TEA notice by voice vote.

The board also approved March 2024 budget amendments; the district plans further budget reviews and said it expects a final budget adoption in August 2024 after continued modeling and stakeholder input.

What’s next: The district will submit notice to TEA and continue to present revised budget scenarios to the board ahead of the August adoption timeline.