In a straw vote Friday\u00a0in Rockville, nine members of the 11-member Montgomery County Council approved a $7.9 billion operating budget for next fiscal year that supporters say will\u00a0provide\u00a0tax relief for most\u00a0county residents while providing\u00a0additional\u00a0money for public schools.\u00a0<\/p>\n
The council-approved budget for fiscal year 2027, which begins July 1, includes a $143 million\u00a0year-over-year\u00a0spending\u00a0increase for Montgomery County Public Schools (MCPS).\u00a0<\/p>\n
But that amount is still\u00a0$36 million short of what the district requested\u00a0from the county\u00a0\u2014\u00a0meaning\u00a0hundreds of educator positions\u00a0could\u00a0be eliminated<\/a>\u00a0as the\u00a0Board of Education\u00a0works to balance the MCPS budget in the weeks ahead.\u00a0\u00a0<\/p>\n The\u00a0budget approved by the council on Friday\u00a0does not include the\u00a06.3-cent property tax rate increase<\/a>\u00a0recommended by County Executive Marc Elrich (D)\u00a0to fully fund schools next fiscal year.\u00a0\u00a0<\/p>\n It\u00a0does\u00a0include\u00a0a\u00a0progressive income tax plan<\/a>\u00a0to raise the local income tax rate from 3.2% to 3.3% for filers making $150,001 or more annually and lower the income tax rate for everyone making less. Elrich had proposed a uniform 0.1% income tax rate hike for all filers regardless of yearly earnings.\u00a0<\/p>\n Those who voted to approve the budget included Council President Natali\u00a0Fani\u2011Gonz\u00e1lez\u00a0(D-Dist. 6), Vice President Marilyn Balcombe (D-Dist. 2) and Councilmembers Sidney Katz (D-Dist. 3), Kate Stewart (D-Dist. 4), Kristin Mink (D-Dist. 5),\u00a0and\u00a0Evan Glass, Shebra Evans, Will Jawando and Laurie-Anne Sayles (all D-At-large).\u00a0\u00a0\u00a0<\/p>\n Councilmembers Andrew Friedson (D-Dist. 1) and Dawn Luedtke (D-Dist. 7) voted against the budget.\u00a0<\/p>\n Though the property tax rate will remain the same in fiscal year 2027, some homeowners will still\u00a0have\u00a0a higher property tax bill next year due to the council majority\u2019s decision to\u00a0eliminate\u00a0a $692 tax credit available to filers who claim their home as their principal residence.\u00a0\u00a0<\/p>\n Eliminating\u00a0the property tax credit, called the Income Tax Offset Credit (ITOC), freed up money\u00a0to support the progressive income tax plan.\u00a0The\u00a0plan was part of\u00a0the\u00a0alternative budget framework<\/a>\u00a0put forward last month by\u00a0the council president once it became clear that most councilmembers would not support any\u00a0property\u00a0tax hikes.\u00a0<\/p>\n \u201cI did introduce the progressive income taxing structure, and I did it as one of the first things I did as council president because it\u2019s the right thing to do,\u201d\u00a0Fani-Gonz\u00e1lez said before the council\u2019s vote on Friday. \u201cThose who are making less money should be paying less income tax and I don\u2019t regret that.\u201d\u00a0<\/p>\n In a statement after the council\u2019s straw vote on Friday, Elrich said although he was \u201ccriticized relentlessly\u201d over his plan to raise property and income tax rates, the council\u2019s plan also results in higher property tax revenues by\u00a0eliminating\u00a0the ITOC.\u00a0<\/p>\n \u201cThe Council approach is regressive, hitting homeowners with lower value homes harder, putting the entire burden on homeowners and leaving commercial property owners untouched,\u201d Elrich said in the statement.\u00a0\u00a0<\/p>\n State law does not allow counties to set different tax rates for commercial and residential properties. The state does allow counties to implement progressive income tax rates, but the tax rate for the highest earners cannot exceed 3.3%.\u00a0<\/p>\n Infrastructure dollars reallocated<\/p>\n The budget approved Friday was the culmination of months of deliberation over tax rates and funding levels for public schools and other core government functions. Without Elrich\u2019s proposed tax increases, the council had\u00a0an\u00a0$189 million gap to fill.\u00a0<\/p>\n In her comments before Friday\u2019s straw vote, Mink said the budget the council planned to bring to a vote on Thursday morning would have reduced the school district\u2019s requested operating budget by $73 million.\u00a0<\/p>\n \u201cAs you saw yesterday, when it came down to that high-pressure moment, we had the votes needed to block that budget on behalf of MCPS, and we are back today having cut that in half,\u201d Mink said, referring to the council\u2019s last-minute decision to\u00a0postpone the straw vote<\/a>\u00a0that was originally scheduled for Thursday afternoon.\u00a0<\/p>\n \u201cWe don\u2019t know for sure which jobs we didn\u2019t save\u201d Mink said. \u201cBut as a former teacher and a current MCPS parent, I know that it doesn\u2019t matter how excellent a teacher is, you need a much broader support system in order for our kids to access their full potential.\u201d<\/p>\n Jawando\u00a0on Friday suggested taking $36 million from the county\u2019s $6.3 billion six-year capital improvements program (CIP) and giving it to MCPS for operating expenses, funding two $18 million tranches that would have otherwise been slashed.\u00a0\u00a0<\/p>\n Jawando\u2019s\u00a0motion to reallocate the infrastructure funds passed 7-4, with\u00a0Jawando, Fani\u2011Gonz\u00e1lez, Balcombe, Katz, Mink,\u00a0Evans\u00a0and Sayles in\u00a0favor. Glass, Friedson,\u00a0Stewart\u00a0and Luedtke opposed the motion.\u00a0<\/p>\n \u2018No good options\u2019<\/p>\n In making his motion to reallocate money from the capital to the operating spending plan for MCPS, Jawando said he was\u00a0cognizant\u00a0of the fact that there were \u201cno good options.\u201d\u00a0<\/p>\n \u201cThere are worse options, and among them would be the devastating, catastrophic cuts to MCPS staff and educators,\u201d\u00a0Jawando\u00a0said.\u00a0<\/p>\n Jawando added that he tried to convince his council colleagues to\u00a0approve a higher bond limit<\/a>\u00a0for the next six fiscal years, which would have allowed the county to borrow more money for capital projects, but\u00a0a majority of\u00a0them voted not to do so.\u00a0<\/p>\n \u201cWhen we wait till the end like this, we\u2019re in a difficult situation and we have to make difficult choices,\u201d\u00a0Jawando\u00a0said.\u00a0\u00a0<\/p>\n Stewart said one of the hardest parts of this year\u2019s budget process for her was listening to MCPS parents and employees speak about\u00a0mold, asbestos and other issues<\/a>\u00a0in their school buildings. Because of those needs, she said, she could not support\u00a0Jawando\u2019s\u00a0motion.\u00a0<\/p>\n \u201cI\u2019m very concerned about what we\u2019re doing with this action and what it means, not just for the near term, and what we can fund for infrastructure, but what it does for us long term,\u201d Stewart said.\u00a0<\/p>\n In his comments before the vote on\u00a0Jawando\u2019s\u00a0motion, Glass emphasized that \u201cno agency and no department in Montgomery County is getting fully funded this budget.\u201d\u00a0<\/p>\n However, Glass said, \u201cI am just a little disappointed that the kids and the educators in New Hampshire Estates and a number of other facilities will not get the help that they desperately asked for.\u201d\u00a0<\/p>\n Budget process\u00a0<\/p>\n