Gregory-Portland ISD looks years ahead at potential budget challenges, talks teacher pay

Gregory-Portland ISD, the highest-paying school district in the Coastal Bend, is working to develop a compensation plan for the next ten years in the midst of projections showing potential future budget challenges.

Since 2016, the district has received about $120 million in payments from industrial entities through Chapter 313, a state property tax incentive program that has ended. These supplemental payments made to the school district by industrial companies in return for a lower property tax bill have boosted teacher salaries.

Though several Chapter 313 agreements involving Gregory-Portland ISD are still in effect and will continue to benefit the district for years to come, these agreements will eventually expire. The Texas Legislature approved a replacement, the Jobs Energy, Technology and Innovation Act, last spring, but this new program doesn't offer the same financial benefits to schools. School districts can no longer negotiate supplemental payments in lieu of taxes with companies, according to the Texas Comptroller's office.

The district expects to receive less than $1 million in Chapter 313 supplemental payments starting in 2027-28 and no supplemental payments by about 2033.

As the property tax limitation agreements expire, companies will have to pay full taxes, increasing property wealth per student in the district. But most of these funds won't stay with Gregory-Portland ISD.

The Texas school finance formula determines an approved entitlement amount that school districts use to cover the costs of educating students. When a property-wealthy district like Gregory-Portland ISD collects more than the entitlement through local property tax revenues, all excess funds must be sent to the state.

The Chapter 313 supplemental payments were immune to this recapture system.

According to information shared with the Gregory-Portland ISD Board of Trustees on Monday evening, the district currently has a healthy fund balance. But when Chapter 313 supplemental payments to the district dwindle and recapture payments to the state increase, expenses are projected to exceed revenues.

Currently, about 93% of the general fund budget without Chapter 313 supplemental payments is dedicated to salaries and benefits compared to a state average of 80-85%, according to the presentation.

"We know we are the leader in South Texas when it comes to the highest starting salary, this year being at $61,500," assistant superintendent for business-finance and operations Ismael Gonzalez III said. "We've continued to stay approximately 15-20% above our surrounding districts, which are at around in average $52,000."

This year, Chapter 313 payments amounted to over $24.4 million. If the district had not had access to those funds, it would it would have had an over $11.4 million maintenance and operations budget deficit instead of a nearly $13 million surplus.

If the district does not begin reducing costs, it will face potential financial shortfalls starting in 2027-28, according to projections included in a draft long-range compensation plan.

Potential considerations include non-reoccurring compensation increases.

A district planning committee including staff and teacher members presented several draft recommendations at a Monday evening trustees meeting. The committee recommendations include a 1% raise for teachers, paraprofessionals and auxiliary staff in 2024-25, and a potential $2,000 retention stipend for teachers, paraprofessionals, auxiliary staff and administrative positions, but also call for new staffing guidelines and potential staff attrition measures, a resource allocation study for all departments and for the district to pursue a reimbursement resolution if a bond election is called next spring.

Interest and sinking tax revenues approved by voters in bond elections are also immune to recapture. Though a 2025 bond election has not yet been called, if the district does go forward with a bond, it could ask for reimbursements to help fund a decade of one-time retention stipends for employees and the district's free lunch program.

These are some of the potential actions the district might take to maintain competitive salaries while avoiding a budget deficit, but specific actions have not yet been approved by the school board.

The trustees will approve a 2024-25 compensation plan and budget in the summer. For later years, long-term planning will continue next fall.

As with other school districts in the region, Gregory-Portland ISD is concerned by a lack of new state public school funding.

"Going into the next (legislative) session, we'll be developing our legislative priorities," Superintendent Michelle Cavazos told the school board Monday, adding that the district will have to work with the community to talk to lawmakers about school finance.

Other teacher pay programs

Gregory-Portland ISD participates in the state's Teacher Incentive Allotment program, which offers teachers whose students show the most learning growth a special designation and a pay allotment.

These pay boosts are state-funded. The district can only provide allotments to teachers that meet standards outlined in a local designation system approved by the state.

The Gregory-Portland ISD Board of Trustees approved a Teacher Incentive Allotment spending plan Monday.

The district had a total of 76 teachers who earned a TIA designation, including nine at S. F. Austin Elementary School, 20 at T. M. Clark Elementary School, 17 at East Cliff Elementary School, 15 at W. C. Andrews Elementary School, eight at Gregory-Portland Middle School and seven at Gregory-Portland High School.

Among these teachers are 18 recognized teachers, 47 exemplary teachers and 11 master teachers. Recognized teachers are among the top 33% of Texas teachers, exemplary are among the top 20% and master teachers are among the top 5%.

Depending on the teacher designation level and their campus's socioeconomic and rural status, Texas TIA-designated teachers can earn allotments ranging from about $3,000 to $32,000.

Designated teachers receive allotments for five years. Teachers who did not receive an allotment also have the opportunity to earn a designation in future years.

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This article originally appeared on Corpus Christi Caller Times: Gregory-Portland ISD plans for how to maintain high teacher pay