Charlotte City Council members are holding back a $1 million grant for a CMS teacher housing project until the district explains how it would spend the money.

The freeze comes after internal emails showed CMS leadership suggested using the city grant to cover $30,000 monthly payments to a consulting firm that lacked a board-approved contract, the Charlotte Observer reported Thursday, Sept. 24.

District 7 Councilman Ed Driggs, who represents south Charlotte, said the delay is not unusual because the project's details were not finalized when the council committed the funds. But he raised a pointed concern about how CMS might direct the money.

"It is not my impression that using (the city's grant) money for payments to (McGregor) would be consistent with our intentions," Driggs told the Observer.

Charlotte budgeted the $1 million in 2025 to support CMS's "At Home in CMS" initiative, which aims to make housing more affordable for educators. The school board voted in May 2026 to set aside 7 acres next to Garinger High School for up to 138 apartments for teachers. No funds have been disbursed.

City spokesperson Jason Schneider said staff are evaluating the project's status. The CMS board signed the grant agreement earlier in September 2026, but the city has not counter-signed it, Schneider told the council in an email update on Wednesday, Sept. 23.

At-large Councilwoman Dimple Ajmera, a budget committee member, said in a written statement that the city should not release the funds until it has a clear accounting of how the money would be used and whether every expenditure complies with city requirements. District 2 Councilman Malcolm Graham, who chairs the budget committee, said the council will receive an update on the project before Charlotte executes the agreement.

The grant hold is the latest fallout from a widening CMS contracting controversy. A human resources complaint filed Aug. 21, 2026, alleged then-Board Chair Stephanie Sneed insisted CMS pay Qonnect LLC $30,000 a month without a formal contract.

Qonnect is owned by Raki McGregor, who served as the district's chief executive in residence the prior year. Public records show CMS paid $150,000 in monthly retainer fees routed through law firm Poyner Spruill to Qonnect between April and August 2026.

In an email thread obtained by the Observer, Sneed suggested the city grant could cover the Qonnect expenses, referring to the $1 million as "pre construction monies" awarded two years earlier.

Sneed resigned as board chair on Tuesday, Sept. 22, ahead of a vote to oust her. She remains on the board. That same day, the board voted 5-4 to fire Superintendent Crystal Hill, who had questioned the payments in a memo to board members.

The North Carolina Secretary of State dissolved Qonnect LLC on Sept. 17 for failing to file an annual report. District Attorney Spencer Merriweather asked the SBI to open a criminal investigation into "alleged financial irregularities" at CMS on Sept. 18. As we reported on the state auditor's CMS probe on Wednesday, Sept. 23, a separate state financial review is also underway.

The draft grant agreement would require CMS to repay the city for any expenses deemed ineligible. No date has been set for the council's review of the project.