The 7 things we still don’t know about CMS’ investigations, contracts and turmoil
Weeks into a widening series of investigations into Charlotte-Mecklenburg Schools, the public knows far more about the contracts, consultants and internal disputes that triggered the scrutiny than it did in September.
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But some of the most important questions remain unanswered.
Public records and former Superintendent Crystal Hill’s memo have raised questions about outside legal work, consultant payments, board authority and internal financial controls at Charlotte-Mecklenburg Schools, while federal and state investigators are examining alleged financial irregularities at the district. Yet neither investigators nor the district have fully explained which transactions are under review, who authorized some of the spending, what taxpayers received for it or how much board members knew before the concerns became public.
Here are some of the biggest questions that remain.
Multiple outside entities are examining CMS or matters connected to the district.
The FBI and U.S. Attorney’s Office have confirmed an active federal investigation related to CMS. That investigation began before Mecklenburg County District Attorney Spencer Merriweather formally requested a State Bureau of Investigation probe in September, and subpoenas have been issued. Federal officials have not publicly identified the investigation’s specific focus.
Merriweather initially asked the North Carolina State Bureau of Investigation to conduct an informal inquiry into reports of financial irregularities and later requested a formal criminal investigation into potential state-law violations involving fraud or embezzlement in local government payments. He has not identified the transactions involved.
State Auditor Dave Boliek separately said his office is reviewing a broad range of CMS records, including budgets, contracts and other financial documents. The State Board of Education and Department of Public Instruction also called the allegations of financial irregularities “serious” and said they would coordinate with other investigating agencies.
What remains unclear is how much those inquiries overlap, and which contracts, payments or departments are drawing the most scrutiny.
Some of the most heavily scrutinized transactions involve Raleigh law firm Poyner Spruill and Qonnect LLC, a company owned by former CMS executive-in-residence Raki McGregor.
CMS hired Poyner Spruill for work connected to the district’s teacher-housing initiative. The law firm later entered into an agreement to pay Qonnect $30,000 a month for consulting work on the project. Hill wrote that she did not know McGregor had been brought back into the initiative after she declined to renew his direct CMS role, and she said she did not know how the project came to be handled by Poyner Spruill, board member and former chair Stephanie Sneed and McGregor.
Hill’s memo also describes finance staff raising questions about how consultant services for the board were supposed to be paid and documenting the need for a written contract and normal vendor procedures.
The district has since disclosed contracts, invoices and correspondence surrounding the arrangements, but questions remain: Who had authority to retain or direct consultants working for the board, and what approvals were required before CMS money could be used to pay them?
The question is especially significant because CMS’ ordinary purchasing policy does not necessarily govern every service retained directly by the school board in the same way it governs district purchasing.
The paper trail is even less clear when it comes to what CMS received in return.
The Charlotte Ledger reported CMS said it had no records of work produced by McGregor or Qonnect for the teacher-housing project. The district also said it had no records of a final work product from a separate $220,000 Poyner Spruill compliance assessment focused on CMS’ HR and finance operations. Of that contract, $132,000 was allocated to Qonnect.
That HR and finance assessment was paused in September after board members raised concerns about Qonnect’s involvement.
The unanswered questions are straightforward: What services were actually performed? Who reviewed or accepted that work? And what documentation did CMS rely on when approving payments?
Other unresolved questions have little to do with outside consulting firms.
At the Sept. 22 board meeting, CMS officials disclosed about $1 million in late Exceptional Children’s Department invoices that arrived after the fiscal year ended, after the department had already spent its budget. Chief Financial Officer Kelly Kluttz said the expenses were not tied to contracts or purchase orders.
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WFAE later reported CMS already identified another roughly $4 million in Exceptional Children’s spending that did not comply with purchase-order or pre-audit requirements, bringing the known total to about $5 million. It remains unclear exactly what those expenditures were for, which vendors received the money and who authorized the spending.
Additionally, the letter the board sent to Hill when it placed her on leave cited whistleblower allegations of an unexplained $20 million deficit in the Exceptional Children’s program for the 2025-2026 school year and a $2.4 million deficit in pre-kindergarten for the 2024-2025 year. The public report on the Hill investigation did not address those figures, and information released by the board has not specifically identified alleged mismanagement of those funds as part of the review.
It’s still unclear what those shortfalls actually were, whether the allegations were proven true, and whether they are connected to the separate EC spending problems later disclosed by CMS.
Hill’s memo also raised a question about teacher pay.
Hill alleged that during a March meeting, Sneed directed her not to include about $4.5 million in additional supplements for teachers with 15 to 25 years of experience in her budget recommendation. Hill wrote that Sneed said there was a better use for the money and asked that it be put “on hold.” Hill said she instead applied the $4.5 million toward the local cost of anticipated state raises because she was required to present a balanced budget.
Three school board members later told The Charlotte Ledger they did not know until Hill’s September memo that Sneed had allegedly directed Hill to leave the additional supplements out of her budget.
Rankin, in an email sent to the Observer through board communications director Sheri Costa, disputed Hill’s characterization. He said board leadership discussed potentially delaying use of the $4.5 million because of uncertainty over the state budget and other district needs, with the expectation that the full board would discuss it later. Rankin said no directive was issued telling Hill not to use the money for teacher raises.
Rankin said the funding later came before the full board during public budget deliberations. At that point, he said, CMS had budgeted for a 5% teacher raise while the state was considering an 8% increase, creating a need to use the $4.5 million to help cover educator raises.
What remains unclear is how the $4.5 million was handled before it reached the full board, what role board leadership played in that process and when other board members were brought into the discussion.
Hill’s memo also describes multiple employee grievances involving board leadership whose outcomes remain largely out of public view.
In February, Poyner Spruill was selected to review a grievance against Sneed, board member and current chair Gregory “Dee” Rankin and acting General Counsel Anna Hehenberger. Hill wrote that she did not know who selected the firm, whether all board members knew about the grievance or what the investigation ultimately found.
The Charlotte Observer’s news parter WSOC-TV later reported the grievance involved allegations of age discrimination and questions about whether Sneed and Rankin had authority to eliminate a district position. Hill also wrote that another employee filed an August grievance against Sneed alleging harassment, possible illegal contracting activity and a hostile work environment. That matter was referred to a different outside law firm. The status and outcome of that investigation have not been publicly disclosed.
Many of the actions now under scrutiny share one feature: key officials said they did not know about important decisions until after they had already been made.
Hill said she was unaware McGregor had been brought back into the teacher-housing work through Poyner Spruill. She wrote that she believed most board members also did not know. Finance staff separately raised questions about the documentation needed to process payments. Several board members said they did not know about the decision involving veteran-teacher supplements.
Those accounts leave a more sweeping unanswered question about governance at CMS: At what point did individual board members, senior administrators and finance officials learn about the contracts, grievances and spending problems now under scrutiny?
This story was originally published October 16, 2026 at 5:30 AM with the headline “The 7 things we still don’t know about CMS’ investigations, contracts and turmoil.”
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