Forsyth County schools outline three-step 2026 budget timeline, warn of TRS and health-care pressures

Larry Hammel, a district finance staff member, presented a three-step timeline for the 2025–26 budget process at the Forsyth County Schools work session on March 11. He told the board the district opens operational budget modules in November, runs salary-benefit projections in December–February, and refines revenue estimates in late spring before presenting a draft budget in May.

Hammel said the operational budget uses a zero-based approach for non-salary items, with departments entering requests into the district’s budgeting module and then meeting individually with finance staff for review. “We have 3 steps to the budget process,” Hammel said, describing the operations, salary/benefits and revenue projection phases.

The nut graf: The schedule matters because large, partly uncontrollable items — notably teacher retirement (TRS) changes and health-care costs — will influence how soon a reliable draft can be presented. Hammel warned these items and pending state figures mean the district may need to delay final mill-rate action until July or August and use a continuing resolution for early fiscal-year operations.

Most important facts: Hammel said salary and benefit modeling consumes the most time; some reports can take hours to run and the office typically prepares multiple scenarios (with and without step increases and COLAs). He said the state’s QBE allotment and the local property-tax digest are outside district control. For property tax he is using a flat 4% cap for initial calculations but is awaiting digest- and homestead-exemption-related updates from the tax commissioner that could arrive in May or June.

Hammel flagged three revenue risks the board should monitor: possible state TRS pass-through increases, significant health-care cost increases (he estimated it “could run us $10-plus million”), and declines in interest income if the Federal Reserve cuts rates in the coming year. He said he is modeling three potential interest-rate cut scenarios and will update projections as new data arrive.

Board context and next steps: Trustees thanked staff for the early, detailed briefing for three new board members and the new superintendent. Several trustees noted legislative activity may create unfunded mandates that would affect the final budget. Hammel and staff plan to provide multiple budget scenarios to the board before a May presentation and recommended the board expect possible adoption in July or August if state numbers are delayed.

Ending: Hammel said the district will continue refining assumptions and bring regular updates to the board as state figures and economic indicators become available.