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Rutherford County Schools board approves coverage of 2026 insurance premium increases using outcome funding
Summary
The board approved a recommendation to cover an estimated portion of the 2026 employee insurance rate increases using annual outcome funding (TCISA) rather than the district—s fund balance, with staff estimating a two-year split cost of roughly $1.94 million if board covers half of the aggregate increase.
Rutherford County Schools board members voted to approve a staff recommendation to absorb a portion of the 2026 employee insurance premium increase and to fund that cost from recurring outcome funding rather than from the district—s fund balance.
District staff said the insurance enrollment period runs Oct. 3 through Oct. 31 and that the recommended motion was based on prior board requests and an approved budget. Staff described the district—s outcome funding (referred to in the meeting as TCISA outcome funding) as annual revenue the district receives but does not budget in advance because the exact amount can vary. Staff said the district typically receives at least $4,000,000 in such annual outcome funding.
"This is not coming out of the fund balance," board member Miss Rosales told the board after confirming with staff. Dr. Sullivan (district staff) summarized the cost estimate: if the board opts to cover roughly half of the aggregate premium increase, the estimate for the full-year increase is approximately $1,943,435, which staff said would be split across funds (fund 141, 142, 143) and fiscal years in some cases. Staff cautioned this figure is an estimate that depends on employees' plan choices and that the quoted increase covers January through December while the district—s fiscal year is July through June.
Several board members expressed support for using outcome funding to limit employees' out-of-pocket impacts. "I'm so glad that we're able to do this work ... so that they can take that extra increase that they get every year from their salary. They can put it into their pockets and not be paying for insurance," said a board member during the discussion.
The motion to approve the recommended insurance-rate action passed by voice vote. District staff said they will use outcome funds and reconcile across the district's year-end cleanup process if necessary.
The board's action outlined the funding approach and left specific plan-by-plan cost allocations to staff during implementation. The meeting record does not show a line-item change to the budget in the public portion of the meeting; staff said they will adjust budget entries during the midyear cleanup to reflect the actual outcome funding amount when known.
