Houston ISD enrollment decline puts pressure on campus staffing, budgets

Despite improving education ratings, enrollment at the Houston Independent School District (HISD) is in decline, leading district administrators to direct campuses to cut costs and staff as financial gains slow to a crawl. 

In the three years since the Texas Education Agency (TEA) took over HISD operations, campuses have begun bearing the fruits of the state’s labor. According to the 2026 release of TEA’s A-F accountability report, nearly eight out of 10 HISD schools have received an A or B rating, while only four schools still have an F rating compared to 55 in 2023. 

State-appointed Superintendent Mike Miles’ New Education System (NES) has yielded positive results, turning around what was seen as a sinking ship just a few years prior. However, despite academic success, the system is placing a significant burden on district finances. 

The district lost around 8,000 students in 2025, leading HISD officials to plan a budget geared around losing a projected 4,000 students this year, according to May documents. Despite raising academic standards, school districts rely on attendance to dictate how much the state funds them. Losing students results in reduced revenue and budgetary shortfalls. 

Reports estimate that HISD campuses are losing tens of millions of dollars as more students leave. To maintain the transformative reforms that have raised the quality of these schools, the district is implementing a “campus leveling” process to tidy up loose ends. These annual evaluations score the direction where money flows, adjusting schools’ funding based on how close their enrollment matches projections. While some cut roles will be reassigned to other positions, campuses are laying off employees to attempt to bridge shortfalls caused by lower attendance. 

Staff members aren’t the only thing being trimmed. Campuses are reducing funding to or fully cutting programs that have been staples of the curriculum for years. 

Despite education score improvements across the board, rapid budget reductions have raised concerns that the NES way of thinking may not be sustainable. Since 2023, roughly 21,000 students have left the HISD system, reducing the district’s overall budget by at least $190 million. The reforms typically cost each campus around $700,000 in the first year of implementation, with an additional $2,000 shelled out per student in subsequent years. 

While roles are being cut, HISD has also been implementing new policies to support teacher retention and improve academic performance. The district implemented a new Pay-for-Performance (PFP) model for the current school year to incentivize teachers to raise their performance standards in exchange for higher pay. 

The PFP model means the district will pay teachers based on their effectiveness rather than number of service years. The policy is intended to retain teachers who positively impact their students. HISD has also implemented proactive teacher coaching, actionable feedback and clear expectations to prepare teachers to improve the quality of their instruction and learning spaces. 

State officials see the merits of HISD’s restructuring as the model for how educational systems should be across the state. However, that success has a high price tag, and both district and campus officials are working around the clock to make up for lost revenue and shore up attendance numbers to keep things sustainable and affordable. 

Image courtesy of HISD