MoCo Council Approves Final $7.9 Billion Operating Budget

MONTGOMERY COUNTY, MD — The Montgomery County Council on Thursday voted to approve the capital and operating budgets for fiscal year 2027.

The decision came nearly a week after officials held a 9-2 straw vote on the plan, with councilmembers Andrew Friedson and Dawn Luedtke opposing.

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On Thursday, the council voted unanimously to approve the $6.3 billion six-year capital budget. The $7.9 billion operating budget also passed with a 9-2 vote, with Friedson and Luedtke once again opposing.

"The council’s budget decisions this year have been some of the most challenging since the Great Recession," Council President Natali Fani-González said in a statement following the vote. "Thank you to all of our residents, community partners and nonprofits who expressed their views on the budget throughout our deliberations. Your input has guided this process every step of the way."

The Thursday vote solidifies a progressive income tax structure in the budget that will raise taxes for homeowners making over $150,000 and reduce levies for those who fall below that mark. It replaces County Executive Marc Elrich’s proposed across-the-board income tax increase.

Under the plan, Montgomery County residents earning more than $150,000 will pay a 3.3% income tax rate, while lower-income households will receive reduced rates on the first $150,000 of earned income.

The council also rejected Elrich's proposed 6.3-cent property tax increase per $100 of assessed property value.

How Will MCPS Respond To Budget Shortfall?

The sticking point that took center stage during budget talks was the county's inability to fund Montgomery County Public Schools fully.

While the budget does include a $143 million funding increase, the figure still falls short by $36 million.

Shortly after the final vote was recorded, MCPS Superintendent Thomas Taylor filed a list of recommendations that would close the gap with the school board.

Related: Council OKs $7.9 Budget But MCPS Cuts Still Possible

Taylor previously warned that staffing cuts were a possibility, but that he would attempt to keep any staffing reductions as far away from the classroom as possible.

A final decision on how MCPS will adjust to account for the financial gap won't be made until the board's June 4 vote.

Veto Still Possible

Eltich initially called for an approximately 6% property tax hike and a 0.1% income tax increase to fully fund Montgomery County Schools.

“The County Council repeatedly criticized my budget proposal, saying they were worried about a structural deficit,” Elrich said during a media briefing Wednesday, according to a report by The Banner. “Then they passed a budget that creates, using their framework, a much bigger long-term problem."

At the briefing, Elrich also told reporters that while he doesn’t have the authority to veto the income tax plan, he will look at other places to cut; however, the council can override his veto with a supermajority vote.