Cumberland County projects $8.2 million 2026 gap; officials outline scenarios to protect reserves

Carrie Finkenminder, a finance staff presenter, told the Cumberland County Finance Committee at its finance meeting that the county’s preliminary 2026 general fund budget shows about $110,000,000 in revenue and about $127,000,000 in expenses, leaving an approximate $8,200,000 gap.

Finkenminder said the county expects to end 2025 with about 103 days of general fund operating expenses in unassigned fund balance with no use of fund balance management. She warned that rising costs and lower-than-expected real estate tax growth are pushing projections downward and described several line-item shifts that produced the current gap.

The nut of the presentation was why the gap matters: with a projected decline in fund balance after 2026, finance staff recommended continuing cost-containment measures, monitoring revenue risks and considering incremental policy changes to avoid spending down reserves.

Ron Snow, a finance staff presenter, said the county is “in a strong financial position” but urged continued vigilance. He walked the committee through three scenarios staff modeled: (1) small incremental changes (about 4–4.5% annually) supplemented by roughly $300,000 per year of fund-balance management; (2) a larger one-time adjustment of about 11% in 2026 (roughly $8,000,000) that would reduce the need for additional changes in 2027; and (3) delaying changes and using the full $6,000,000 of available fund-balance management in 2026, which would leave larger required adjustments later.

Key figures and drivers cited by staff included: real estate tax projections down about $1,100,000 from earlier forecasts; other revenues up about $3,000,000 driven in part by recorder of deeds/transfer taxes and filing fees (+~$300,000), a contracted rate for services to the Department of Corrections (+~$260,000), and increases in lease/usage revenue (+~$900,000), which carry offsetting capital-related expenses; subsidies down about $1,000,000 largely because of shifting 911 project scope; county grant program spending shifted later, reducing 2025/2026 outlays by about $900,000; and an earlier projection to use $1,300,000 of fund-balance management that staff now expect to be used across the projection horizon.

Finkenminder and Snow described the county’s fund-balance “thermometer” benchmarks: roughly 70 days (about $22,600,000) as the line between red and yellow, about 100 days (about $32,300,000) between yellow and green, and a worst-case top mark near $46,600,000.

Staff also summarized assumptions in the five-year forecast: real estate tax growth assumed at 2% in 2026 and 1% in 2027–2029 (staff said 2025 underperformed the earlier growth assumption and 2026 carries an “aggressive” 2% number); salaries projected to rise roughly 4% per year because of wage-scale adjustments, step increases and new positions; medical insurance costs projected to increase about 8% for 2026; and a new normal for capital outlays closer to $4–5 million per year versus the historical ~$3 million, with large swings possible depending on outcomes of an ongoing feasibility study.

Snow noted staff translate percent changes into dollar amounts when modeling: “For example, 1% change equals $700,000,” meaning a 1% shift in revenue or a 1% ongoing expense change equals about $700,000 in the model.

Committee members asked questions about assumptions and possible revenue offsets. Commissioners and staff discussed permit activity and commercial development (including references to Costco and BJ’s as drivers of future taxable growth), the possibility of additional jail contracts, and insurance and benefits costs as levers to control spending. One committee member emphasized preserving as much of the county’s $6,000,000 of fund-balance-management reserves as possible.

Staff advised that the county’s projections currently show using all fund-balance-management resources by 2027 if ongoing changes to revenues or expenses are not implemented. They recommended continuing incremental budget actions to reach breakeven and avoid larger single-year adjustments later.

Finance staff said they are available for additional finance meetings and scenario work in October. The timeline presented calls for placing the 2026 budget on view on Nov. 5 and for final consideration and approval on Dec. 3.

Votes at a glance: The committee approved the minutes from Oct. 1 at the start of the meeting.

End: Finance staff will provide more detailed appendices and remain available to meet with departments and committee members as the county moves toward the Nov. 5 public viewing and the Dec. 3 vote on the 2026 budget.