Harlingen school district fund balance climbs to $21.2 million

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HARLINGEN — School leaders’ steps to tighten their budget are helping boost the district’s fund balance from a low of about $17.2 million, with cash reserves climbing to $21.2 million.

Now, the district’s general fund revenues stand at about $105.8 million, with expenditures at $102.4 million, Ida Ambriz, the district’s interim assistant superintendent of business services, told school board members during a meeting.

“We’ve had an increase of $3.5 million in our fund balance in the last three or four months, so good work,” board President Greg Powers told her during Tuesday’s meeting.

As part of the district’s new fiscal plan aimed at driving up the budget’s fund balance, student enrollment’s a key funding source.

Based on a formula, for every student attending class, the state gives the district about $6,460.

As of Jan. 31, the district’s enrollment stood at 16,441, falling short of last year’s mark by 339 students, leading to a loss of $2.1 million, Ambriz told board members.

While students’ average daily attendance rate stands at 93.6%, officials set their goal at 94.5%, she said.

“So we’re getting closer to that goal,” she said.

Since last month, officials have been planning next year’s budget.

“We are actually headed into a real busy season with finance and planning because we’re going to start doing all of our budgeting — our budget planning for next year,” interim Superintendent Veronica Kortan, the board’s finalist for the superintendent’s job, told trustees during a Feb. 4 meeting. “Things like doing deep dives into some of our biggest areas of expenditures are going to be important.”

Last week, officials began reviewing the district’s staffing within its departments and campuses, Kortan said.

Through February, the new Early Exit program was offering $1,000 incentives to professional staffers who retired or resigned.

Meanwhile, school board members are working to give employees pay increases.

”Our goal is to have an adoption of our compensation plan in May, which means that compensation and those related topics are also going to have to come to the forefront here,” Kortan told trustees.

For more than five months, officials have been working to pull the district out of one of its deepest crises in decades.

“It seems we’ve gotten over a phase in the last few months of what I would call corrective measures to our budget planning,” board member Dr. Nolan Perez told officials Tuesday.

Under Kortan’s leadership, he said, officials are “planning to make sure that we have money for it, making sure we’re maintaining our budget, but also always right-sizing the budget based on what’s happening with the levers we control, whether it’s enrollment or tax dollars coming in.”

“But most importantly, I love that you guys are involving the entire organization,” Perez said. “It’s not just two people — the superintendent and our finance department — but it’s also all the executive directors, the senior team. I think it’s just amazing where we’ve come in these last few months. It gives us a lot of confidence. We can sleep without worrying that no one’s looking with great detail and with that much fidelity to the taxpayers.”

From 2022 to 2024, the district’s fund balance dropped from $48.3 million to $17.2 million, its level when the school board passed the current $215.3 million budget last June, Noe Hinojosa, the district’s financial advisor with Estrada Hinojosa, told board members in January.

At the time, he projected a period as long as three to five years to build back the budget’s fund balance.

Under the district’s new fiscal plan, officials have cut at least $7.2 million, working to rebuild the fund balance after former Superintendent J.A. Gonzalez’s administration used $23.2 million in cash reserves to cover operating costs including unbudgeted expenses.

Across the district, officials are planning millions in budget cuts, aiming to rebuild the fund balance.

In late August, school board members found out Gonzalez’s administration had pulled $23.2 million in cash reserves, dropping the fund balance as low as $17.2 million.

While officials argue Gonzalez’s administration pulled the money without the school board’s knowledge, Gonzalez claims he didn’t know Ramon Mendoza, the district’s former assistant superintendent of business services, was withdrawing cash reserves.

In early September, Gonzalez, who had taken office a year before after serving as McAllen’s superintendent since 2016, suddenly resigned with two years left on his contract, five months after board members gave him a one-year contract extension along with a $10,000 pay increase, bumping his salary to $310,000.

In November, the certified public accounting firm of Carr, Riggs and Ingram gave the district a clean audit for the 2023-24 school year.

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