Craig Howell FINANCIAL REVIEW – Jeff Davis, of Education Consulting Team LLC, provided an overview of the estimated budget for the Hancock County School District’s 2026-2027 fiscal year as part of discussions during the school board’s meeting Tuesday. Also pictured, in back, is Hancock School Board member Randy Swartzmiller.

NEW CUMBERLAND — The Hancock County School District’s 2026-27 budget is almost finalized following a presentation and hearing held Tuesday, with officials also noting a memorandum of understanding between the district and state to repay an $8 million loan provided to assist with ongoing financial issues.

During Tuesday’s regular meeting, those in attendance heard from Jeff Davis, of Education Consulting Team LLC, regarding the budget for the next fiscal year.

Davis presented a budget of $43.5 million for the general fund, which includes $19.3 million in local revenue, $29.3 million provided by the state and $575,000 in federal funds. The budget also included a carryover of negative $6.5 million as a result of the budgetary problems discovered last fall.

Noting the budget is a conservative estimate, Davis also reminded the board of the importance of staying within those estimates.

“We have to live within the budget. We can’t overrun any projects,” he said. “We want to get the county out of a deficit.”

Of particular note, Davis explained the school district is expecting a reduction of $5.2 million in local property taxes when comparing the current and upcoming fiscal years, as well as a loss of $302,000 in levy revenues. There will be an anticipated $1.1 million increase in state formula funds, although Davis said that is primarily the result of a 3% pay increase approved by the Legislature for state employees.

Officials have noted the state aid formula is primarily based on enrollment numbers for the school district, determining how much funding will come from the state, as well as an ideal number of teachers and staff members to be employed.

The school district was taken over by the state Department of Education in January as a result of financial issues, which included the danger of not making payroll twice this year. As part of actions taken by the state, the district had to reduce staffing levels by more than 130 positions in an effort to control costs.

Board President Chris Gillette asked whether there was any idea of effects on the budget from the HOPE Scholarship program, which allows a portion of funds to be put toward other educational opportunities.

Davis, however, said any impact would not be visible until the 2028 budget.

The board also discussed an MOU to address repayment of the $8 million allocated by the Legislature for the school district this spring.

Superintendent Walt Saunders reminded the board the funds are designed as a loan and must be repaid to the state in the future.

“We are tentatively looking at a three- to four-year repayment plan,” Saunders said, while noting there is no specific schedule, it could take longer, and there is the option of partial payments or a lump-sum payment. “When we accumulate a reserve, we make payments.”

Answering a question from Gillette, Saunders explained the possibility of enacting a new levy to assist in repaying the loan was not an option.