MCS budget shortfall now at $2.6 million

Since the county commissioners passed the 2026-27 budget in June, Macon County Schools has been trying to figure out how to make up for a $2.4 million shortfall. The shortfall swelled to $2.67 million after the state passed its budget in July. The school system knew there were going to be adjustments to the budget. This inevitably happens, as the school system has to build its budgets from three separate income streams – the state, county and federal governments – which are not always approved by the time the fiscal year starts. In the 2024-25 budget the school system drew 64% of its funding from the state, 20% from the county and 5% from the federal government, taking additional funds from the nutrition program and other sources. In 2025-26 the system prepared its budget in anticipation of a state budget which never came. Chief Financial Officer Alayna Ledford said the issue comes from the way the state handled raises for teachers this year. The district planned for a 7% raise for certified staff such as teachers and a 5% raise for classified staff such as support staff, custodians and similar personnel. The retirement rate was projected at 25.5% and the hospitalization cost was projected at $9,000. With the state's July budget, the numbers came in at 8% on average for certified staff with a 16% raise for new teachers taking the starting salary from $41,000 to $48,000. The retirement rate increased to 26.1% and hospitalization dropped slightly to $8,925. "That's a great thing," Ledford said. "Great for those new teachers coming in, but it does hit our local budget." The state leaves local government to pay for classified staff, and covers the most essential certified staff, but most school districts require their local governments to cover the costs of some certified instructors. According to Superintendent Josh Lynch, Macon County Schools has in the past covered some salaried positions with grant funding to help maximize its ability to run its programs and make the most use of its revenue sources. That tactic drew criticism from some Macon County commissioners, who said the system should have known better than to use nonrecurring funds for recurring expenses. Lynch noted without this grant funding, the school system would have run into this shortfall much sooner. "From what I have seen and heard from other districts," Ledford said. "Macon County Schools is not unique in using local funding to support positions. State funding does not cover every position or every need within a school district, so school systems rely on county funding to help fill those gaps. How those local dollars are used varies from district to district. Some may prioritize funding positions, while others may prioritize different needs." As of June 2026, MCS had requested $14,330,860.69 in operational funds from Macon County to cover local expenses, which included 62.95 classified positions and 41 certified positions. The Board of Commissioners approved $11,814,471 in June, leaving the school system with a $2.4 million shortfall. After applying state raises to locally funded positions, the total local funding requirement to maintain system services rose to $14,488,941.25 and the shortfall increased to $2,674,470.25. Ledford said teachers are feeling the impacts of the shortfall in their budgets for supplies, library materials and staff development, but teachers are not being asked to take on more work without compensation. Macon County Schools is still working to complete and approve its budget for the new fiscal year. Board discussion School board member Stephanie Laseter said she would like to see the school board send an updated request for funding and the commissioners request the state "understand the impact to them, that it's wonderful for teachers but they also need to get funded for that in order to fund us." Board member Hilary Wilkes said she would like to be able to show commissioners data to indicate the human impact of the shortfall. Board Chair Jim Breedlove said the commissioners had expressed interested in having more frequent ongoing meetings with the school board. "Is there an indication that that is going to happen soon?" Wilkes said. "Because we tried all summer, it felt like, to get something on the calendar." "My only hesitation with going to them … if you look at this like any budget, we have to have $14.48 [million], but that's what we have to pay people," she continued. "The updated ask to maintain is still $2.6 million shy of what we're getting, but that is nonnegotiable funds, am I wrong? That $2.6 million has to come from somewhere to pay people what we are mandated by law to pay people." "To maintain our current level of operations and to try to maintain, provide the best education, that is the money we'll have to come up with," Breedlove said. "It's through a combination of fund balance usage and also the very difficult discussions and choices that Josh [Lynch] is having to make with Laney [Ledford], we're having to make some very, very hard decisions in terms of how to make up that difference." Ledford predicts the system's fund balance will end at $1.7 million for the 2025-26 year. "Something else that concerns me is the fact that when we open up our new high school we have got to hire more staff," said board member Melissa Evans. "Next year is going to be even more. That's something that's, I think, conceptually understood, but I don't know if the numbers are clear," Wilkes said. "That's more than what we originally even looked at having to come up with, and we're suspending critical programming. Already, that's happened, and personnel." Lynch noted the system recently had two very highly qualified teachers back away from offers of employment because they could get better supplemental pay in neighboring counties, and said taking that offer from neighbors with stronger supplements, for a young beginning teacher, "that's really a no-brainer." "Unfortunately this has been years in the making, not being able to keep up with the rising costs, inflation, things of that nature," Lynch said. "And yes, I know commissioners have given money, but to keep up with the pace that we are in need of and the lack of being fully funded from the state level, that's where the deficit [comes from], and each year it's bigger and bigger … now, unfortunately, there is just not a fund balance to appropriate." Breedlove said the system was able to build its healthy fund balance by managing COVID-19 funding from the federal government, developing its fund balance rather than spending it all in preparation for rising costs. "If it weren't for that, we'd be in a much worse situation," Breedlove said. Ledford said the district sees staff reduction as a last resort and has not terminated any employees in response to the shortfall, but the school system is, through attrition, looking closely at existing positions as they become vacant to consider whether they need to be refilled to help reduce local expenses.

MCS budget shortfall now at $2.6 million

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