State school takeovers come with costs districts must cover, from superintendent payouts to conservators

When the Texas Education Agency steps into a struggling school district, the district's own budget pays for what follows, an Austin Current report published by The Texas Tribune on Monday shows.

The report looks at Austin ISD, which faces state intervention after two of its middle schools, Webb and Burnet, received five straight F ratings. The district has appealed those ratings.

If they stand, Education Commissioner Mike Morath can choose among several options, including a full takeover that replaces the elected board with appointed managers and installs a new superintendent, or keeping local leaders in place under a state conservator.

What other districts have paid

The report tallies costs elsewhere:

• Houston ISD, taken over in 2023, drew nearly $450 million from its reserves in the first two years for new programs, technology and higher pay at some campuses. Superintendent Mike Miles started at $380,000 and now earns a base of $462,000.
• Fort Worth ISD, taken over in March, paid at least $412,000 plus benefits in its separation with its former superintendent and pays a conservator $250 an hour plus travel.
• Beaumont ISD will pay its previous superintendent $245,000 to serve as an adviser through January 2027, on top of the state-appointed leader's salary.
• Wichita Falls ISD kept its leadership but pays a state-appointed conservator.

TEA does not give districts extra money for intervention costs. Agency spokesperson Jake Kobersky told the publication that the state works with district leaders to identify other revenue sources.

Results and tradeoffs

On results, the report notes that nearly eight in 10 HISD campuses earned an A or B this year, about double the share before the takeover. The report also notes HISD cut hundreds of central office jobs and some transportation and social work services, and about 21,000 students have left the district, which works out to roughly $190 million less in state aid.

Fort Worth ISD faces a shortfall of nearly $50 million next year.

Roxanne Martinez, a removed Fort Worth ISD trustee, said residents want to know the full cost and whether the spending improves student outcomes.

Austin's position

Austin ISD ended last year with a $105 million deficit, cut $205 million from this year's budget, closed 11 schools and must borrow $140 million to cover payroll through November. Superintendent Matias Segura's contract, with a $362,000 base salary, does not spell out a separation agreement in case of a takeover.

Trustee Candace Hunter said the district cannot absorb new costs and that the state should help pay for required changes.

Sources

The Texas Tribune