Clear Creek ISD projects multi‑million deficit; board weighs tax election, approves efficiency‑audit contract

The Clear Creek Independent School District on June 22 received a detailed budget update from Chief Financial Officer Miss Benzai showing multi‑year deficits driven primarily by falling enrollment and high payroll costs.

Miss Benzai told the board the district was planning for a 2026–27 deficit scenario that could reach $20.1 million without changes to compensation or staffing, and that the district’s unassigned fund balance stood at roughly 2.7 months of operating expenses. She said capital and contingency reserves can provide temporary relief but are not a sustainable solution.

Why it matters: the district’s fund balance and contingency funds are what rating agencies and bond markets watch. Benzai warned that falling well below about two months (the commonly referenced 20% threshold) could raise borrowing costs and reduce financial flexibility.

Board members pressed on options for closing the gap. Benzai said administration is modeling a range of choices: trimming staff or programs, pursuing operational efficiencies, increasing local revenue via a voter tax‑rate election and rebuilding teacher pay steps using one‑time and recurring funding choices. She summarized three TASBY compensation models presented to trustees: Model 1 (rebuild steps, raise starting salary to $64,000; ~ $3.7M cost), Model 2 (smaller midpoint bump plus step adjustments), and Model 3 (starting salary ~$65,000 with broader increases; near $6M cost). The district has not adopted a compensation path and emphasized recurring costs must fit the multi‑year forecast.

Benzai also described benefit pressures: new TRS health plan rates could increase district premiums by about $3 million next year, forcing debate about employer versus employee contribution adjustments and ACA affordability constraints.

One prominent revenue option is a voter tax‑rate election. Benzai explained the mechanics of 'copper pennies' (additional maintenance tax pennies) and showed homeowner impact examples (adding five copper pennies increases an average homeowner’s annual tax by roughly $123). She cautioned that some pennies generate recapture to the state, reducing net local gain.

Timeline and next steps: administration said the deadline to hire an efficiency auditor to preserve the option of a voter election this cycle is July 3. The board heard that the strategic budget team — a 33‑member group of trustees, staff, parents and community members — ranked recommendations and prioritized revenue optimization, facility and staffing efficiencies, and preparing voters for a potential election. Trustees scheduled further discussion at a July 13 workshop, with a potential public hearing in August depending on the board’s path.

Direct quotes: Miss Benzai summarized the reserve function plainly: "Our fund balance is basically just like our savings account at a home. ... We live on the Gulf Coast and we are at risk for hurricanes. So we have to have funds in the bank." A trustee urged clearer board direction: "What the district needs from us is direction. We need to give them some direction."

What the board did: later in the meeting trustees approved a $16,000 contract with Weaver and Tidwell LLP to perform an efficiency audit, a step administration said would be required if the board chooses to order a voter tax‑rate election in August.

What’s next: trustees will receive the strategic budget team’s compiled recommendations and return for a July workshop to discuss compensation, staffing and whether to prepare for a voter tax‑rate election. If the board orders an election this summer it must meet July deadlines for auditor selection and August notices.