Cabarrus County Schools faces $11 million budget deficit. What should parents know?
Cabarrus County School officials are working to close a multi-million dollar budget deficit before the school year ends, though its chief financial officer said he’s not sure it’s possible.
The district became aware of its deficit in late December when it began forecasting the year’s expenses, CFO Phillip Penn said in an email to the Observer. While the deficit sits around $11 million, Penn told school board members Monday evening the department is trimming expenses where possible.
“I’ve been asked several times in the last four weeks if the budget challenges can be overcome by the end of the fiscal year, and the candid answer to the question is, ‘I don’t know yet,’” Penn wrote in a memo to school board members. “Success will likely depend on our willingness to aggressively limit hiring and our openness to ask for relief where it’s warranted.”
Penn said asking the Cabarrus County Commission for funds could be helpful for the district. Though the board did not comment on Penn’s presentation during the Monday evening school board meeting, some school board members aren’t opposed to asking the county for more money.
In January, board chair Rob Walter said his motivation for appointing Shannon Lancaster to the school board is her connections to elected officials and the role she could play in helping obtain funding. She is married to Cabarrus County Republican Party chairman Lanny Lancaster.
What should parents know?
The budget deficit is due to increased enrollment, higher expenses than anticipated, and a decrease in expected revenue, according to a January memo from Penn to the school board.
Expenses like legal services, disability programs and salaries were more costly than expected, Penn said. Meanwhile, revenue sources like Medicare, state grants and funding from the county were lower than expected this year.
Parents should know the district has a lack of funding for students with disabilities, Penn said in his email. This will impact all students because the costs for the district’s Exceptional Children program will need to be made up elsewhere in the budget.
Penn said Monday the district has made strides in the past month to help make up some of the deficit.
Healthcare costs for the district are $986,000 lower than expected, as not all staff enrolled in the healthcare plan offered, he said. Utilities for the district are running $300,000 below the same period last year; the new curriculum will require $450,000 less than expected; and budget cuts to departments have saved the district $375,000.
The state also provided $100,000 in funding for the Exceptional Children program, he said, though the budget deficit for the program still sits over $3 million.
In the next few weeks, Penn said the district will continue to limit hiring and review federal grants to see if they are larger than originally planned.
The next budget forecast for the district will take place March 18.
“The good news is I’ve got a team that’s fairly experienced in solving these issues, including myself,” Penn said. “I’m hopeful (if) we’re committed to making sure that we’re considered as aggressive as we can be and limiting future expenditures for now to the end of the year, and frankly, asking for a relief if it’s warranted if we need to go back to the county, for instance.”
This story was originally published March 5, 2025 at 5:30 AM.
