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Proposed FY24 budget fully funds schools, raises property tax rate

by Judith Hruz


County Executive Marc Elrich’s recommended Fiscal Year 2024 Operating Budget of $6.8 billion fully funds the request of Montgomery County Public Schools, but in order to do that, and maintain the services, public safety, affordable housing programs, economic development efforts and efforts to combat climate change that residents have come to rely on, Elrich has recommended a 10-cent increase in the county’s property tax rate.

All of the revenue generated by that increase would be directed exclusively to Montgomery County Public Schools (MCPS).

The property tax increase is the “only significant increase” Elrich is asking for in this budget he said.

In 1974, the property rate was $1.50 per $100 of assessed property value.

“The tax rate has gone down as the school system has grown,” he said, adding it is difficult to maintain the school system on a tax rate that is two-thirds of what is once was.

Montgomery County currently has the lowest commercial property tax and second-lowest residential tax in the National Capital region. Among Maryland’s 24 jurisdictions – 23 counties and Baltimore City – 11 other jurisdictions have a higher property tax rate than Montgomery County.

Montgomery County’s rate is currently 99 cents per 100 of assessed property value. The rate in Howard County is $1.014 and Baltimore County is $1.10 and Frederick County is $1.06.

Montgomery is fifth amongst the largest school systems in the state in per-pupil spending. If the 10-cent tax increase is approved by the County Council by a majority vote, Montgomery would become third highest in the state for per-pupil spending.

The recommended school system budget meets the request of the Board of Education – a request that is a record $296 million above the funding provided in Fiscal Year 2023, which is the current year, and $264 million above the state-required maintenance of effort.

The funding is needed “to recruit and retain outstanding educators, teachers and other essential school staff, as well as address the increase in special education enrollment,” according to the county executive’s budget report.

Elrich said there is a correlation between not spending money on education and classroom results.

“We are not funding the most precious thing we have,” he said.

The proposed budget is an increase of 7.7 percent over the Fiscal Year 2023 approved budget.

The County Council required the county executive to present a recommended budget by March 15 of each year, which will be reviewed by the County Council for two months. The council will approve a new county budget in late May, and the budget will go into effect at the beginning of the new fiscal year on July 1.

Elrich said the current fiscal year – 2023 – has been challenging because the county is coming out of several years of explosive revenue growth and a real estate market that was very high before the federal government raised the interest rate — $300M revenue above

But with the potential for a “mild recession” and real estate market slowing down tremendously, he said, the revenue stream has changed.

In addition, federal funding that came to support municipalities during the coronavirus pandemic, such as rental assistance, for example, is ending, but Montgomery County does not want those services to be lost due to lack of funding.

“The needs are still real,” Elrich said.

“As we undertake this important task, the council will provide thorough oversight to ensure taxpayer investments are used prudently,” County Council President Evan Glass (D-At large) said in a statement. “We must balance the needs of today with those of tomorrow, which include supporting our schools, our teachers, our first responders, our health care professionals and other frontline workers.”

He encouraged residents to participate in the upcoming public hearings and submit testimony to the council.

The council’s public hearings on the operating budget are scheduled for April 11 at 1:30 p.m. and 7 p.m. and April 13 at 1:30 p.m. and 7 p.m. Those interested in testifying at the public hearings in person or virtually can sign up on the council’s webpage at https://www.montgomerycountymd.gov/council/calendar.html or by calling 240-777-7803 through April 10 at 2 p.m.

Spanish language interpretation will be available both in-person and virtually. Interpretation in other languages is available upon request with at least three working days of notice.

Prerecorded audio or video or written testimony can also be submitted on the council’s webpage at https://www.montgomerycountymd.gov/COUNCIL/PHSignUp.html.

In addition, testimony can be sent by U.S. Postal Service to: County Council, 100 Maryland Avenue, Rockville, MD 20850, or by calling the council budget hotline at 240-777-7802.

Information on the FY24 Recommended Operating Budget can be found on the Office of Management and Budget’s web page at https://www.montgomerycountymd.gov/omb/.

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