An Examination of Budget Reductions in High-Wealth Property School Districts and Low-Wealth Property School District in Texas Dora E. Sauceda, Ed.D. The University of Texas at Austin, 2012 Supervisor: Julian Vasquez Heilig In June of 2011, The 82nd Legislature approved a reduction to Texas public education funding in upwards of $4 billion. Districts, regardless of wealth, responded by making budgetary reductions that affected personnel, programs, and services. The reduction in funding is expected to continue into the next biennium. This study examined the prioritization of budget reductions and process utilized by high-wealth and low-wealth property school districts to enact budget reductions to the various operating expenditures and the inequities that surfaced as a result of the reductions. The research questions included in the study were: 1. What budget-reduction options are prioritized at the district level for high-wealth property school districts versus low-wealth property school districts? 2. What budget-reduction process was utilized at the district level by high-wealth property school districts and low-wealth property school districts? 3. What district-level budget functions were slated for reduction at high-wealth property and low-wealth property school districts and what are the equity implications that surfaced as a result of the reductions? The study utilized a mixed-methods design. A 5-point Likert scale survey and semi-structured interview were used to examine the budget-reduction prioritization and process. An independent samples t-test was utilized to examine 2010-2011 and 2011- 2012 per-pupil expenditures by function (N=60). The sample included 30 high-wealth and 30-low-wealth school districts. The results of the qualitative data indicated that districts prioritize communication with stakeholders and school boards when deciding on budgetary reductions. Communication of the budget problem to all stakeholders was a high priority so as to ensure buy-in once decisions on budget reductions were made. The semi-structured interview revealed emergent themes that included maintaining the vision, transparency, stakeholder participation, equity, and impact of budget reductions. The t-test revealed statistical significance in the areas of instruction, security services, and payroll. The results also revealed that programs and services aimed at assisting the students with most need were either decreased or eliminated. Findings derived from this study will provide educational practitioners and policymakers with a conglomerate of information on how school-district leaders are examining their financial resources, areas designated for reduction, and areas they perceive as vital for preservation. / text