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Charles County schools shift $12M inside FY2025 budget and add $3M from fund balance as special‑ed and operations costs rise
Summary
At the May 13 meeting the district asked the board to approve a $12 million intercategory transfer and a $3 million increase to the FY2025 budget from fund balance to cover higher than expected expenses — notably special education contracted services and nonpublic placements, custodial overtime and health insurance increases.
The Board of Education approved a series of budget moves on May 13 that together reallocate more than $12 million between categories in the current fiscal 2025 Charles County Public Schools budget and increase the overall 2025 budget by $3 million from fund balance.
What the board approved - A motion passed to transfer roughly $12,000,000 between budget categories to cover shortfalls in special education, operations, staffing and fixed charges. The formal intercategory transfer moves funds from some instructional and capital categories into special education, operations of plant, fixed charges (including health insurance) and food services. - The board approved using $3,000,000 from fund balance to increase the FY2025 budget. The CFO described this as part of a larger pattern: $8 million of fund balance had already been used in-year and the new request brings funds moved from reserves toward $10 million for the current cycle.
Why the increases were needed CFO Karen Acton and Budget Manager Sherry Fisher Davis told the board that the primary drivers were higher costs for contracted special education services and nonpublic placements, where both hourly rates for related‑service contractors rose and nonpublic schools increased pay to recruit staff. Acton said contractors cited rising hourly rates for SLPs and other vendors and that some nonpublic schools raised their tuition costs after statewide salary changes.
Other cost pressures cited - Operation of plant: additional overtime for custodial and safety staff and other plant costs prompted a $3.5 million increase. - Fixed charges: health insurance costs rose and the district approved an increase of about $1.1 million under fixed charges. - Food service: $750,000 was moved to offset student meal account and food‑service needs.
Board discussion and context Board members asked for details on whether these were structural or one‑time costs and sought assurances the district would use stricter procurement and approval controls going forward. Acton said the district planned to tighten approvals for contracted services and review vendor reliability to limit expensive contract selections. Superintendents and staff said some increases are recurring (for example higher nonpublic tuition commitments) while others (overtime spikes) can be managed operationally.
Fund balance and sustainability concerns Several board members noted the long‑term implications: fund balance usage is meant for one‑time needs; repeated draws reduce fiscal flexibility. Acton reported the district began the process with roughly $38 million in fund balance and that this action reduces that reserve by approximately $8–10 million this cycle — a level board members warned is not sustainable without longer‑term revenue or expense reductions.
Next steps and transparency Acton and staff said they will bring more detailed line‑by‑line recommendations, tighter vendor approvals and options for next year’s budget to the board during the upcoming budget cycle. The board approved the intercategory transfer and the $3 million fund balance increase by unanimous voice votes on May 13.
Ending The district stressed that the increases are aimed at covering legally required services and emerging costs while staff work to control future expenditures; board members asked for repeat updates and tighter approval processes to limit in‑year draws on fund balance.
