McAllen ISD’s board of trustees voted Monday to unassign $25.8 million in federal ESSER monies in an effort to shore up district finances.
The district is facing a $6 million budget shortfall, the latest hurdle in an ongoing financial struggle that started in 2022.
The district blames tight finances on statewide school funding issues and demographics in McAllen that have hurt enrollment.
The ESSER monies trustees voted to unassign would have funded 21 different projects and expenditures, everything from bus tires to student enrichment camps.
By far the largest single expenditure would have gone toward the fine arts. The district had committed almost $11 million to build one to three black box theaters at campuses.
Superintendent René Gutiérrez said Monday that funding those projects simply isn’t the district’s top priority at the moment.
“McAllen ISD — from what I’ve seen as I look at the finances — is it had not been building up the fund balance like they could have,” he said. “Many districts did, and that is that they utilized ESSER funds to supplement other costs and then save it into fund balance.”
During the pandemic, the federal government doled out billions in ESSER funds to school systems across the nation.
In Hidalgo County, that money fueled a glut of projects and construction; HVAC improvements often proved a popular choice.
For at least some districts, the money even temporarily staved off the need to go out for a bond.
Those funds, however, dry up in September.
Gutiérrez said that unassigning those funds will help the district avoid fiscal turmoil from those funds running out. The alternative, he said, is a “funding cliff.”
“This is the last year that we have ESSER funds. This is the last opportunity that we have to recapture some of those funds and put them in a general fund,” he said.
Gutiérrez also noted that the district may not have been able to complete all of those projects prior to the deadline to spend the ESSER money.
Is there a chance any of the cut projects could be resurrected? Gutiérrez says it’s possible.
“We may be able to do some. I mean, I don’t think they’re all off the table,” he said. “But right now, what we need to do is try to increase our fund balance so we can work on a budget for next year.”
Monday’s vote wasn’t unanimous.
Board President Debbie Crane Aliseda — a longtime advocate for black box theaters — said she opposed cutting that project in its entirety and voted against unassigning the funds.
“So much ESSER money went to athletics,” she said. “We got a press box, we got football fields, we got baseball fields. So much of the money went to athletics, and none went to fine arts. And we have so many more students that participate in fine arts than we do in athletics.”