Johnston County schools adopt midyear budget amendment after finance staff outlines funding shifts

Johnston County Board of Education members voted to approve a midyear budget amendment after staff laid out how the district plans to cover约 $4.2 million in teacher-pay needs by year-end.

Finance staff told the board three main factors affected the district’s finances this year: lower-than-budgeted vacancy savings, enrollment growth (including charter and virtual increases), and the closeout of ESSER funds. Those issues, staff said, required moving budget lines among allowable funding sources to avoid drawing on undesignated fund balance.

The presentation summarized that the district budgeted for a 5% teacher vacancy rate but is averaging closer to 2–3%, producing a shortfall in vacancy savings equal to roughly 52 positions. That gap, using the district’s average compensation assumptions, was presented as about $4,200,000. Staff said the district also recorded a net enrollment increase that generated approximately $920,000 in state funds for 138 students and that charter enrollments rose by 218 students, prompting a local budgeted estimate of $449,000 to cover charter-related outflows.

To address the teacher-pay gap, staff described permitted funding moves among federal and state programs. According to the presentation, the district moved certain exceptional-child (EC) contracts into ESSER (where allowable), shifted EC supplement costs into Medicaid where eligible, and then redirected freed local allotment budget lines into the local teacher-pay line. Those changes were summarized by staff as producing roughly $2.8 million of the needed $4.2 million; the remainder would come from reductions in unused planning-period stipends and other vacancy-related savings. Staff said ESSER-funded construction projects came in under budget, freeing about $1.9 million that helped indirectly to cover local needs.

Finance staff framed the approach as staying within program rules while avoiding use of core fund balance. The presenter said the district was “likely to head towards a break even point this school year” after the moves and cautioned that several variables (utility costs, further enrollment changes, and low-wealth allotment volatility) could affect final results.

Board members asked clarifying questions about how Medicaid and low-wealth allotments may be used and about the district’s assumptions for planned capital and technology expenses. Staff confirmed ESSER is more flexible but requires state approval for reclassifying certain expenditures, while Medicaid reimbursements are more restricted and tied to time-and-effort documentation and other federal requirements.

Board members then voted to approve the third budget amendment and the midyear update. Motion by Mr. Donovan; second by Mr. Tippett. All present voted aye.

Looking ahead, staff said the district must plan for continued lower vacancy rates, one new school opening next year, curriculum adoption costs, ongoing charter enrollment growth, the sunset of some ESSER-funded positions (including contracted custodians), and uncertainty in the state low-wealth allotment that could change year to year. The finance presentation and related handouts were posted to the district finance web page, staff said.