Waco Independent School District will turn over control of South Waco and Dean Highland elementary schools in July to the nonprofit Third Future Schools at an estimated cost of $11.7 million a year.
The Waco ISD board approved the contract unanimously with little discussion Monday during a special meeting at Waco High School. The deal is intended to keep the state from taking over the local district due to several years of failing grades at two schools.
The deal will affect some 1,180 elementary students, about 9% of Waco ISD’s enrollment of just under 13,000.
Waco ISD and Colorado-based Third Future Schools will host a series of meetings on the changes for Dean Highland and South Waco families over the next three months, with the first held Tuesday evening.
The Colorado-based firm will begin April 7 to interview applicants for positions at Dean Highland and South Waco elementaries for the next school year. Current staff at the school have until this Sunday to express interest in applying to be Third Future employees.
Faculty and administrators who have an ongoing contract with Waco ISD will be placed at other campuses if they are not hired by Third Future.
Third Future is expected to finalize staff selection by April 17, Waco ISD officials said. Representatives from Third Future Schools were present during the board meeting but were not available for interviews.
The firm, which runs schools in multiple Texas communities, offers an average salary of $75,000, well above Waco’s average of $63,613. But Third Future Schools are known for highly scripted instruction and extended educational schedules.
The two schools will have 184 instructional days, 10 more than other schools in the district.
The district will pay Third Future Schools 11 payments of about $814,000, Waco ISD officials said Tuesday. The district will pay Third Future Schools to oversee the day-to-day operations at the two campuses, including hiring faculty and staff. The firm will have its own liability insurance.
The payment will come from a combination of local and state funding, including additional state grant funds available under the state law that authorizes the partnership.
It will not have an impact on the tax rate, according to Waco ISD officials.
The payment does not cover every cost at the two schools.
“The district will have to absorb all the transportation costs, except for field trips, and except for the days that they have school above and beyond our normal school calendar,” said Waco ISD Chief Financial Officer Sherry Smith on Monday.
State law allows school districts to partner with charter schools, government entities, institutions of higher education and nonprofit organizations, according to the Texas Education Agency. The partnership gives school districts a two-year reprieve from state intervention that would otherwise be triggered by a failing school.
State law requires the TEA to intervene if school districts receive five years of F ratings in its A-F accountability rating system. Dean Highland has received three consecutive years of failing ratings and South Waco has received four.
District leaders, in a video statement posted in February, said the partnership will help better focus its resources and maintain local control.
The board on Feb. 26 unanimously approved moving forward with negotiations with Third Future.
As districts continue to feel the pressure from the state, more districts are considering partnerships with Third Future, the only contractor approved by TEA to operate in multiple school districts.
Killeen ISD approved a contract with Third Future Schools on March 24. Other districts with partnerships with Third Future Schools include Austin ISD, Midland ISD and Wichita Falls ISD.
Correction, April 1, 2026, 10:51 a.m. Central:
An earlier version of this story misstated the number and percentage of students who would be in schools controlled by Third Future Schools.
