Memphis-Shelby County Schools present June 2025 budget amendment, move to adopt FY2026 budget amid grant uncertainty and competing priorities

The Memphis-Shelby County Schools (MSCS) presented a June 2025 budget amendment and the district's proposed fiscal year 2026 budget during a full-board committee meeting, with administrators urging the board to approve a procedural amendment now and adopt the FY2026 plan at a special call meeting the next day.

Chief Tito Langston, chief of business operations, told the board the June amendment "authorizes a net increase of $9,900,000" in the general fund to align the budget with newly approved state grants and accounting codes. He said the amendment also reflects a net decrease of about $6,400,000 in the capital fund to match the county commission's capital improvement budget, and a roughly $4.2 million increase in nonfederal special revenue funds driven by awarded grants, including a special-education preschool grant and an extension of the district's Innovative School Model award. "We got approved for the summer learning camp grant," Langston said, and the amendment adds that funding into the general fund. He added that the district received more USDA money for school meals this year, prompting about $4.5 million of additional revenue and spending in the nutrition services fund to cover higher food costs.

Why it matters: District leaders said the amendment is primarily procedural: it aligns MSCS accounts to state grant awards and prepares the system for the fiscal audit later this year. But board members pressed staff for details on several high-visibility items that will shape FY2026 spending and operations.

Head Start and ESSER funding

Board members probed the status of the Head Start grant, which Langston said remained uncertain at the time of the meeting. "As recently as last week ... we still haven't heard whether we have it yet," he said, adding that the Head Start funding runs on a calendar year and the district was approved only through June 30. Langston said staff have contingency options and would bring recommendations to the board when the award amount is known. On ESSER funds, Langston said MSCS has submitted documentation to the state for about $55.6 million in capital improvement reimbursements and was "hopeful" the funds would be returned so the district would not have to draw on fund balance.

Staffing, teacher pay and compensation study

Interim Superintendent Roderick Richmond and Langston outlined investments planned in FY2026 that the proposed budget would restore or add, including funding for ACT curriculum, a chief of student support position, districtwide formative assessment and expanded supports for early grades. Richmond described a reorganized senior leadership structure with a chief academic officer and a chief of student support, and said regional superintendents will report to the superintendent. Langston said the district expects to add 701 "specialized education assistants" (SCAs) for K-3 settings at a projected cost of about $29.4 million.

Board members repeatedly questioned salary and retention strategies. Vice chair Love and others asked about an ongoing compensation study; Langston said the vendor now expects to deliver results in July and that the project had grown in scope because of the district's many distinct job descriptions. Richmond and Langston said the district implemented a salary schedule this year that lifted starting pay, and plans include a salary-step progression for teachers and a 2% increase for non-teacher staff; administrators said a 6% across-the-board increase requested by employee groups would cost roughly $30 million in year one and nearly $99 million over five years.

Teacher vacancies and certification

Langston said the district was still finalizing exact retirement and vacancy counts but estimated roughly 350 open positions during active staffing and noted MSCS funds a smaller class-size ratio than the state, which creates a higher overall number of financed teacher positions. The meeting also covered a high number of unlicensed teachers: staff reported roughly 1,300 unlicensed teachers districtwide and approximately 242 on a limited 30-year permit. The administration said it was expanding supports to help unlicensed teachers earn certification and to convert vacancy pipelines into staffed positions.

Literacy, tutoring and partnerships

Budget discussions produced extended debate about in-district versus external tutoring and literacy partnerships. Several board members asked whether MSCS could replicate or scale programs that external partners had piloted. Chief Langston read a budget summary provided by a partner that showed a proposed annual operating cost around $3.7 million, with personnel lines roughly $2.87 million and a per-student annual cost described in the partner's materials.

Board members expressed two consistent concerns: (1) attendance patterns matter for tutoring impact (administrators reported that students who attend 90% or more of sessions are the likeliest to see gains), and (2) the district needed clearer evaluation metrics before committing recurring operating funds to an external organization.

Langston suggested partnering with community organizations and testing programs in priority schools with grant dollars before embedding costs in the general fund. The board asked staff to get line-item budgets, replication plans, and evaluation details from partners and report back to the committee before final budget adoption.

Districtwide formative assessment and other contracts

Officials told the board they were moving to renew a districtwide formative assessment through a three-year contract for Performance Matters, a PowerSchool product, at an estimated cost of $859,152.78 over three years; the contract includes professional development and an item bank for schools. Administrators argued districtwide procurement is more cost-effective and provides consistent measures and teacher supports.

Transportation, facilities and emergency readiness

Transportation staff briefed the board on a one-year renewal option for First Student to provide student transportation, showing an estimated FY2026 cost near the figures presented for committee review. Administrators cited a national driver shortage and said contractor pay rates had risen substantially (they reported contractor driver rates had grown to roughly $28 per hour) and that the district will issue an RFP in the fall to test the market. Board members raised pupil-safety questions and asked about bus monitors and progressive discipline for riders.

Facilities priorities discussed included temporary chiller purchases for schools with failed HVAC units, stadium and field upgrades, stadium lighting and fencing in high-need campuses, and a list of capital projects that will be aligned to any county commission changes to capital allocations. Langston reminded the board that the capital fund was being adjusted to match the county commission's capital-improvement figure and that the district would amend its budget if the commission changes its allocation.

Insurance, grants and fiscal process

Risk-management staff recommended renewing property, law-enforcement liability, student-accident and cyber-security policies and engaging Arthur J. Gallagher as broker for consulting services. Staff told the board the district's property-insurance program covers nearly $4 billion in assets and said broker compensation is paid by carriers; Gallagher's services were presented as a no-direct-cost advisory model for the district. MSCS staff also described pending FEMA/state reimbursements for past storm damage and said those receipts would be handled through capital and unforeseen funds.

Next steps and board questions

Administrators asked the board to approve the procedural June 2025 amendment and to be prepared to adopt the FY2026 budget at a special call meeting scheduled for the following day at 2 p.m. Langston reminded trustees that the budget is an estimate and will change as final grant awards arrive: "The budget is just an estimate," he said, adding that staff planned to amend the budget as confirmed revenues are received. Board members asked for more detailed back-up on Head Start, Literacy partner budgets and metrics, capital-tradeoffs tied to the county capital allocation, and the pending compensation-study deliverable.

Ending

The committee concluded with staff committing to bring more detailed cost breakdowns, partner evaluations and a calendar for FY2027 budget planning. Trustees scheduled follow-up committee reviews on tutoring and literacy, CTE/partnership pipeline planning, and the capital project list.