Photo credit: MISD

What happened: Midland ISD trustees unanimously adopted a balanced budget for the 2026-27 school year on Tuesday, June 23, marking the district’s first spending plan in recent years not built on a planned deficit. A year ago, the board approved a 2025-26 budget built on a planned $7.9 million shortfall, down from about a $42 million deficit the year prior.

The district’s general operating budget totals about $350.5 million, including the roughly $44 million recapture payment MISD must send back to the state. After accounting for recapture, the district projects it will directly spend about $306 million on day-to-day operations. Trustees also approved balanced budgets of about $18.1 million for child nutrition and $99.9 million for debt service, for a total proposed budget of $468.5 million.

The board did not adopt a tax rate on Tuesday. The district’s Chief Financial Officer said he expects to recommend keeping the rate unchanged in September, after the state finalizes required calculations.

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The big picture: District leaders said this year’s budget follows roughly $47 million in spending reductions over the past two years, including about $27 million tied to staffing and another $20 million in non-payroll cuts. The budget also includes the employee compensation increases that trustees approved earlier this month.

District officials said two budgeting changes helped eliminate the deficit. Rather than budgeting enough money to fill every authorized position, MISD budgeted assuming campuses would operate at their typical vacancy rate of about 97-99% staffing. Officials also based revenue projections on 93% student attendance, which more closely matches the district’s actual reported attendance rate.

Go deeper: Trustees also approved the final budget amendment for the current fiscal year and several year-end fund transfers. Officials said the amendment technically shows the current year ending with a $13.4 million deficit, but that figure intentionally overestimates the district’s recapture payment to the state. Based on current projections, they expect MISD to actually finish the year with roughly a $590,000 surplus.

Trustees also transferred up to $9.7 million into the district’s capital projects fund. About $3.7 million will pay for previously approved purchases, including route buses that have not yet arrived and an elevator replacement. They are reserving up to $6 million for future capital needs, such as major maintenance projects, but any spending would require separate board approval.

The board separately transferred $3 million into the district’s self-funded employee health insurance plan to help offset higher-than-expected medical claims.

The other side: Officials cautioned that balancing this year’s budget is a one-year achievement, not a permanent fix. MISD is already projecting deficits beginning in 2027-28 as enrollment declines and temporary fast-growth funding expires.

What’s next: MISD expects certified property values from the Midland Central Appraisal District in July and the state’s maximum compression rate in August. Trustees will adopt the district’s tax rate in September.