State Rejects Shelby County's 2026 Budget, County Says Construction Projects Will Continue - Articles

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State Rejects Shelby County's 2026 Budget, County Says Construction Projects Will Continue

Posted by: Julia Wilburn on Oct 2, 2025

The Tennessee Comptroller has rejected Shelby County’s 2026 budget, barring the county from issuing bonds or borrowing money this fiscal year — the first time such a penalty has been imposed on a Tennessee county under a 2021 law. The Daily Memphian reports that Comptroller Jason Mumpower cited repeated deficiencies in budget submissions, including missing details on Memphis-Shelby County Schools funding and fund balances, despite warnings issued last year. The county budgeted $150 million in planned capital projects, including new schools, a replacement trauma hospital, jail improvements and roadwork. Shelby County Mayor Lee Harris and County Commission Chair Shante Avant stated that school and hospital building plans will not be immediately affected by the state’s one-year ban since no borrowing was planned for this fiscal year. Existing bonds issued last spring will cover current construction needs, but the county expects to issue additional bonds in 2027, meaning continued state budget rejections could jeopardize long-term projects. Avant has called for a corrective action plan to address the Tennessee Comptroller’s concerns and restore financial compliance. Harris’ office said projects remain on track, with sufficient resources in place, and pledged to work with the comptroller to resolve the issues. Memphis lawmakers criticized the comptroller's decision as a roadblock, while Mumpower’s office said Shelby County leaders failed to take advantage of opportunities to correct errors before submission.