Forsyth County adopts FY2026 budget, rejects school board's $32.1 million one-time request

Forsyth County commissioners adopted the county'wide fiscal year 2026 budget on a 4-3 vote during a special meeting called to consider the ordinance. The adopted package (referred to as Option B during deliberations) sets the county property tax rate at $0.5352 per $100 of assessed value and includes the community grants list attached as Option B.

The board also approved a formal response to the Winston'Salem/Forsyth County Board of Education, declining the school system's request for a $32,100,000 one-time cash payment to cover state and local shortfalls for the FY2025 year. The letter, approved by a 6-1 vote, said using county fund balance for that purpose would jeopardize Forsyth County's long-standing AAA bond rating and pledged continued collaboration with the school system, the North Carolina Department of Public Instruction and the General Assembly on solutions.

Why it matters: The adopted budget funds county operations, maintains or increases key services and incorporates community grants under Option B while keeping a conservative approach to the county fund balance. The move to decline the school board's cash request preserves county reserves but leaves the district to pursue state and internal remedies for an estimated FY2025 shortfall.

What the ordinance does: The adopted FY2026 ordinance appropriates an estimated $591,011,518 in total budgeted resources under Option B, sets the property tax levy and collection assumptions (based on a May 1 estimate of taxable value and a 99.29% collection rate), appropriates departmental totals, and carries standard budget ordinance sections concerning contingency, contract execution authority, capital projects encumbrances and fund-specific provisions (911 fund, law enforcement special revenue, health benefit internal service fund and others).

School funding and teacher supplements: The ordinance retains explicit language for school budgeting: the board confirmed the county's FY2026 contribution to public schools as requested by the superintendent (the adopted funding level is presented in school correspondence as more than $180 million). It also includes reconciliation and reporting language on teacher supplements (Article 46 funds), requiring quarterly reports to the county on supplement payments and allowing the county to reduce payments if the school system owes the county for services (for example school resource officers, nurses, fuel or lease obligations).

Board debate: Commissioners split over adding a tax increase to assist schools. Commissioner McDaniel urged a modest property tax increase to help the district through an "extraordinarily challenging" 2026 year, arguing a small rise could avert longer-term declines in school quality; she told colleagues it would amount to only a few dollars per month for many homeowners. Other commissioners argued the county cannot responsibly use large sums from fund balance without risking its bond rating and that the scale of the school district's problem requires state action. After multiple substitute motions failed, a motion to adopt Option B passed 4-3.

Formal actions recorded: The board's recorded actions from this portion of the meeting include the adoption of the FY2026 budget ordinance (Option B) by a 4-3 vote and approval of the county's formal letter to the Board of Education rejecting the $32.1 million cash request by a 6-1 vote. The board also adopted reporting and reconciliation language addressing Article 46 teacher supplements.

What remains unresolved: The county's letter notes outstanding questions about how the state will treat certain state funding codes and confirms the Department of Public Instruction indicated FY2026 state funds for Winston'Salem/Forsyth County Schools will be released as planned in July. The county also signaled willingness to negotiate repayment plans for outstanding invoices owed by the school system to the county.