Faced with declining enrollment, the La Joya Independent School District may declare a financial emergency.
During a school board meeting on Wednesday afternoon, Trustee Roberto Zamora recommended that La Joya ISD declare “financial exigency” — a financial emergency — and create a plan to address the problem.
“It’s a sensitive issue,” said Zamora, a widely respected former superintendent who joined the board on June 8. “But at what point in time do we talk about it?”
Financial exigency occurs when the “financial position of the District as a whole is such that the financial resources of the District are insufficient to support existing academic programs or the District is unable to finance the full compensation of staff for the current or succeeding fiscal year,” according to a standard policy reviewed by the board on Wednesday.
A school district may declare financial exigency when a natural disaster strikes, the general fund takes a major hit or enrollment drops more than 10% over a five-year period, among other circumstances.
Texas funds school districts based in part on average daily attendance. Fewer students results in less state funding.
Enrollment at La Joya ISD dropped 16% from October 2017, when the district had nearly 28,800 students, to October 2021, when the district had nearly 24,200 students, according to data published by the Texas Education Agency.
The number of employees on the La Joya ISD payroll remained steady while enrollment dropped.
La Joya ISD employed about 4,300 people during the 2017-2018 school year, according to information reviewed by the school board on Wednesday.
By the 2021-2022 school year, enrollment had dropped 16%. La Joya ISD, though, still had nearly 4,100 employees.
An infusion of federal COVID-19 funding will buy La Joya ISD breathing room next year. When the COVID-19 money runs out, La Joya ISD may be forced to make difficult choices.
“We’ve got to plan ahead,” Zamora said. “We’ve got to look at everything we’re doing.”
Declaring financial exigency would send a message that La Joya ISD is serious about fixing the long-term financial problem created by declining enrollment.
It also would allow La Joya ISD to cut salaries, furlough employees or conduct a “reduction in force” — a type of layoff that reduces costs by eliminating positions.
A reduction in force, however, would be a last resort for La Joya ISD. The district wants to eliminate positions through attrition when employees retire or resign.
“So, as of right now, if I’m still in that position, I still have a job,” said Trustee Espie Ochoa. “But if I decide to leave the district, then my position closes.”
The board may vote on a resolution to declare financial exigency next month.