Orange County and two school districts present FY2026 continuation and expansion requests as federal cuts loom

Chapel Hill-Carrboro City Schools and Orange County Schools presented their FY2026 continuation and expansion budget requests to the Orange County Board of Commissioners at a joint meeting April 29, outlining staffing needs, curriculum costs and the possible effects of federal funding reductions.

Chapel Hill-Carrboro superintendent Dr. Naya Hamlet and Chief Financial Officer Jonathan Scott outlined a continuation request that they estimated at just under $3.8 million before additional special-district tax revenue; after projecting a roughly 2% increase in that tax they said the net continuation need is about $3.25 million. The district’s expansion priorities — including a sustainable fund for instructional resources, reinstatement of master's-level pay for new teachers, increases to classified-staff supplements and restored positions such as teacher assistants and instructional-technology facilitators — together represent several million dollars more in potential requests if additional funds are available.

"This year's expansion budget includes increasing classified staff supplements, securing instructional resources for long term sustainability, and reinstating critical support positions," Dr. Hamlet said. Jonathan Scott emphasized the budget’s sensitivity to state action: "Because of that, we currently don't have any legislated increases or legislative benefit changes for next year... our estimates could be drastically different than what comes to fruition."

Orange County Schools Superintendent Dr. Danielle Jones and Chief Financial Officer Rhonda Rath presented a continuation request they estimated at about $1.815 million, with an expansion package of roughly $2.3 million focused on raising certified and classified supplements and increasing bus-driver pay. Rath said the continuation request supports approximately 7,925 students (6,915 projected district enrollment plus about 1,000 charter students). Orange County Schools closed FY2023–24 with a fund balance of about $4.3 million, Rath said; Chapel Hill-Carrboro's locally available fund balance was described as effectively zero (about $40,000) and will not be updated until the audit later this year.

Both districts stressed that a substantial share of their federal grant budgets supports personnel. Jonathan Scott said matching benefits and retirement-rate increases are major drivers of the continuation need, and that the retirement contribution rate has risen substantially over several decades. The districts warned that proposed federal reductions would likely hit Title I, special-education cluster funds and school-nutrition dollars first — categories that fund interventionists, special-education staff, mentor teachers and free and reduced-price school meals.

Chapel Hill-Carrboro reported roughly $9.2 million in recurring federal funds last year, including about $3 million for school nutrition, roughly $3 million in special-education cluster funds and about $1.4–$1.5 million in federal pre-K/Head Start funding. Orange County Schools reported roughly $6.6 million in recurring federal funds (about 6% of its operating budget). Both CFOs said they have modeled potential cuts in the 15%–25% range and intend to return to the commissioners with specific options should reductions be finalized.

Commissioners expressed concern about tax impacts on residents after a county property revaluation. Commissioner Earl McKee told the boards the expansion requests "give me extreme heartburn" because they could add 4 to 5 cents to the tax rate above the revenue-neutral rate already under consideration; the county manager and several commissioners urged balancing school requests with other county priorities during the manager’s upcoming budget presentation. Several speakers also highlighted equity concerns: higher local taxes could disproportionately affect lower-wealth and minority households.

Administrators named specific operational risks that would follow if expansion items were not funded or if federal grants were reduced: reduced counselor hours at a time of schedule changes, fewer interventionists for students who need remediation, and continued reliance on nonbus staff to cover routes because bus-driver pay lags neighboring districts. "If these funds are taken away from us, we will have to look at our internal budgets," Rhonda Rath said. "We use these dollars for tutoring programs, in our schools and interventionists. Child nutrition ... is our biggest piece."

The joint meeting also set public engagement dates on the county budget timeline: the county’s two budget public hearings will be May 13 (Southern location) and May 29 (Whitted Building), and the Board of County Commissioners plans to adopt the budget June 17. Staff noted that commissioners may post proposed budget amendments for public review before the second hearing and that managers will hold subsequent work sessions.

Votes at a glance The board took one formal vote at the end of the meeting to enter closed session. The motion to "enter closed session pursuant to North Carolina General Statute 143-318.11 to consult with an attorney employed or retained by the public body in order to preserve the attorney-client privilege" passed unanimously, 7–0. Jean Hamilton moved; Carrie Doyle seconded.

Ending Board and school leaders said they will continue to refine requests and return with more detailed options after state and federal actions are clearer. County commissioners said they plan to consider school requests alongside other county priorities when the manager presents a proposed operating budget next week.