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Carroll County presents FY26 recommended budget, staff urges 5% fund‑balance policy
Summary
County staff told commissioners the FY26 recommended budget shows an improved bottom line but remains unbalanced in out years; staff projected roughly $26 million in excess FY25 revenue and an expected unassigned fund balance near $69 million, and recommended holding 5% of the fund balance (about $27 million) as a policy reserve rather than spending it on ongoing school costs.
Speaker 2 presented Carroll County’s FY26 recommended budget and six‑year operating plan, telling the Board of Commissioners the county is projecting about $26,000,000 of revenue in excess of budget for FY25 and an unassigned fund balance that will end near $69,000,000. He repeatedly cautioned that “this is one‑time money” and warned against using it to fund ongoing obligations.
Why it matters: commissioners and staff are weighing a large, temporary fund balance against long‑term obligations — notably public‑school requests tied to Blueprint and growing public‑safety costs. Speaker 2 said the county’s operating plan has improved but remains “not balanced” in later years and that one‑time revenue cannot responsibly cover recurring school expenses.
What staff recommended: Speaker 2 proposed establishing a county policy to hold 5% of the unassigned fund balance — roughly $27,000,000 under current projections — to give the county flexibility for revenue shortfalls or unexpected expenditures. On the proposal he said, “I would like to see us establish a county policy to hold 5% of our unassigned fund balance.” Commissioners sought clarification about whether that portion could be invested and whether interest would count as ongoing revenue; Speaker 2 answered the fund could be invested and that interest would create ongoing revenue only so long as the principal remained intact.
Numbers and constraints: Speaker 2 described components of the FY26 outlook — higher property‑tax assessment assumptions, a higher income‑tax base but slower growth (3.2% assumed versus 4.1% previously), and stronger investment income. He emphasized the primary remaining uncertainty is state income‑tax distributions and that individual quarterly distributions can change the picture by millions.
Context on schools: Speaker 2 told the board the school system had built its request assuming $7,000,000 the county already planned to provide; the superintendent’s request added about $44,000,000 to implement Blueprint, which staff said would create ongoing obligations that one‑time fund balance should not be used to meet.
What’s next: staff will present the proposed budget on the scheduled timeline and hold five public presentations and a public hearing (May 6). The board will consider agency hearings and policy choices during the March–April sessions. The presentation ended with a procedural motion to recess until 1:00 p.m., which passed by voice vote.
