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Cabarrus schools present $536 million draft budget; district to seek county help if state pay raises exceed 3%
Summary
District finance staff presented a $536 million initial budget for 2025–26 and warned the board that if the state raises for employees exceed the 3% assumed in the draft, the district will likely ask the county for a special appropriation to cover local‑funded salary increases.
Cabarrus County Schools finance staff presented the board on Oct. 6 with an initial $536 million budget for fiscal 2025–26 and told members they are monitoring several uncertainties — chiefly the state budget and possible higher salary commitments — that could require county assistance.
Chief Financial Officer Phil Penn summarized key elements of the proposed budget and the principal risks: state funding arrives “in arrears” and is based on prior year enrollment, federal ESSER pandemic monies have declined, and a recent classified‑salary study has raised recurring personnel costs. “The only thing to increase fund balance is revenues have to exceed expenses,” Penn said, noting a tight operating margin and the district’s plan to seek additional appropriations from the county if state legislative decisions require higher local spending.
The proposed budget totals $536 million across all funds: about $262 million in state funds, $112 million in local funds, $16.6 million in federal grants, $110 million in capital projects (county appropriations), $20.6 million in child nutrition and $4.1 million in Kids Plus. Penn told the board the draft anticipates a $115,000 use of fund balance in 2025–26 to cover a timing difference for a previously appropriated ELA curriculum purchase; the district will continue regular monthly variance analyses beginning in October and will bring budget amendments as revenue details are finalized.
Penn also briefed the board on enterprise funds: school nutrition reported a roughly $12.6 million cash balance and is required by federal rules to retain net assets within the program; Kids Plus currently projects using about $500,000 of its fund balance in 2025–26 and staff said the program’s fee structure and employee discounts will be reviewed for future sustainability.
Board members asked about the district’s ability to withstand an unexpected deficit and were told the current fund balance gives “very little wiggle room.” Penn said the finance staff is “working pretty hard to make sure we try to generate a fund balance and a surplus this year” and will present adjustments as the state budget is finalized. The board placed the budget draft on next week’s meeting for formal consideration and public comment.
Ending: The draft will return as an action item next week for public comment and a vote; staff said they will update figures once the state budget and final program allocations are known.
