Fulton County Board of Education approves $2.46 billion tentative FY2026 budget, warns of $98 million shortfall

The Fulton County Board of Education on a unanimous vote approved a tentative fiscal year 2026 budget that totals $2,463,595,140 across all funds, while trustees and staff cautioned the district faces a roughly $98 million budget shortfall next year and "a collision course to insolvency" without changes.

Chief Financial Officer Marvin Dreef read the budget motion and fund totals for the board: a $1,474,973,142 General Fund; $59,424,077 for school nutrition; $65,734,694 in special revenue funds; an $803,515,249 capital program; a $43,254,106 pension fund; and $16,693,871 in student activity funds. Dreef also listed proposed fund-balance commitments of $219,655,624 under DIBA policy and assignments including $23,400,000 for textbooks.

The board approved the motion after a discussion of enrollment and cost trends. "We are absolutely totally underfunded from the federal government as it relates to special education services," Superintendent Looney said, responding to a board member's observation that the federal contribution toward special education is commonly cited as 40 percent. Looney warned that cost pressures have put the district at risk: "Without mixing words, we're on a collision course to insolvency unless we cut expenses, raise revenue, or some combination of both."

Trustees and staff cited several specific drivers of the strain. Board members reported a 4.6 percent decline in student enrollment over the past four years and a 41.5 percent increase in special-education costs over the same period, with a year-over-year increase of about $23 million projected for FY26. The district's total benefit cost for employees was cited at about $59.5 million, driven in part by rising insurance expenses, and officials said local "fair share" payments to the state are expected to consume a growing portion of locally earned revenue.

Board members also discussed the impact of tax exemptions. The record shows tax exemptions rose roughly 136 percent over the past four years and that the district anticipates approximately $242 million in exemptions in the coming year. The board noted a proposed senior exemption on the November ballot that the board had previously signaled support for; staff estimated that change could reduce district revenue by about $50 million annually if approved.

Dreef and other staff told the board that, under the current forecast and assumptions (not including any board decisions about step increases or raises), the district may use up to $68 million from fund balance to balance FY26. The presentation and trustees' remarks emphasized that the roughly $98 million glide/delta projection does not include future compensation choices and that long-term structural adjustments will be necessary.

Votes at a glance: the board approved the FY2026 tentative budget as presented (motion read by CFO Marvin Dreef; motion made by Miss Gregory and seconded by Miss Gillespie) and recorded the vote as unanimous. Earlier in the meeting the board also approved executive-session land, legal and personnel matters, accepted the monthly capital program reports, and approved May 2025 budget adjustments; each of those motions was recorded as carrying unanimously.

What happens next: this approval sets the tentative appropriation amounts and allows staff to proceed with the final budget process and required public hearings. Board President McCabe announced the next work session will be held June 10 at the North Learning Center in Sandy Springs.

Speakers quoted in this report are identified in the board record by the roles used at the meeting.