HAGERSTOWN, Md. — Washington County Public Schools finished fiscal year 2026 with a $5.4 million general fund surplus and received a clean financial audit, as the Board of Education shared at its work session.
Representatives from the accounting firm CliftonLarsonAllen presented the district’s annual financial audit and gave an unmodified opinion on the school system’s financial statements.
Auditors said they found no major problems or significant weaknesses in the district’s internal financial controls.
The $5.4 million surplus made up less than 1.5 percent of the school system’s general fund budget.
Washington County schools maintain financial reserves
At the end of fiscal 2026, the district had an unassigned general fund balance of about $30.2 million.
This amount would cover about 43 days of operating expenses, which is just below the Board of Education’s goal of having enough reserves for 45 to 60 days.
Even though the district ended the year with a surplus, officials said it is important to keep enough reserves for unexpected costs and future financial needs.
The school system’s overall net position also grew by about $3.1 million.
Staffing vacancies and delayed technology purchases affect spending
School officials said part of the year-end surplus came from unfilled positions and spending delayed during the year.
About $700,000 in Chromebook purchases were among the delayed expenses.
These savings helped the district end the year with a positive balance, but they do not mean the district’s operating costs are permanently lower.
Unfilled jobs can lower payroll costs for a year, but delayed technology purchases may still need to be paid for in future budgets.
The financial discussion pointed out the difference between a year-end surplus and money that can be used for ongoing programs or expenses.
Retiree health care obligations remain significant
The audit presentation also covered the school system’s financial responsibilities for retiree health care benefits.
The district’s reported liability for other post-employment benefits, or OPEB, went down from about $315 million to less than $290 million.
At the same time, investments set aside for those future obligations grew from about $139 million to $162 million.
Officials said the investments earned more than 15 percent during the fiscal year.
The district also paid about $19 million for retiree medical and prescription drug claims.
Board members talked about the possibility that the retiree benefits trust could cover some costs if the program becomes fully funded.
However, they did not say the trust had reached that point or that any funding changes had been approved.
Budget adjustments expected to return for approval
The financial presentation gave board members an overview of the district’s finances as officials get ready for future budget decisions.
A year-end budget adjustment is expected to go back to the Board of Education for review before it is sent to the Washington County Commissioners.
The Oct. 7 meeting was a public work session, and officials did not formally vote on the financial report or the proposed budget adjustment.
The audit showed that Washington County Public Schools ended the fiscal year with a positive operating balance and no major audit issues, while still managing reserve goals, delayed expenses, and large long-term retiree benefit obligations.
