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A new budget approach: Reducing the tax burden, cutting government spending and investing in education & nonprofit services - Newsletter from Council President Fani-González

Natali Fani-Gonzalez Montgomery County Council President Newsletter Banner. Collage of photos of Fani-Gonzalez in the community with Gov. Moore and community members.

Neighbors:

After hearing from over 200 residents and many community groups during the FY27 Operating Budget public hearings, it has become clear to me that we need to chart a fundamentally new course with this budget. Residents are facing an affordability crisis, and we must act now to deliver for our residents in a sustainable, responsible way.

Today, I am proposing a new, fiscally-prudent approach to the recommended $8 billion Fiscal Year (FY) 2027 Operating Budget. The new approach would eliminate the proposed 6.3 cent property tax increase, make income taxes progressive, and slow growth in spending, all while preserving social safety net services.

With my proposed budget approach, we can finally deliver a progressive income tax. We can protect the most vulnerable with direct services. We can help keep costs down for residents struggling in this economy. Plus, we can deliver wage increases to our dedicated public employees, support our nonprofits, and increase assistance for working families.

We can do all of this, and more, with bold, progressive action now.

Council president headshot with text: A message from Montgomery County Council President Natali Fani-Gonzalez.

View the Council President’s full message.

The proposed approach would implement a progressive income tax structure, with new County income tax rates ranging from 2.5 percent to 3.3 percent, based on Maryland Adjusted Gross Income (AGI). Under this structure, 96 percent of Montgomery County households would receive a tax break, with those above $300,000 paying slightly more. 

Under this proposal, Montgomery County Public Schools (MCPS) would still receive a $90 million increase in local funding over the last fiscal year. This is on top of the $584.4 million in increased County funding allocated to MCPS between fiscal years 2022 and 2026.  

The proposal targets strategic savings spread proportionally across County agencies – Montgomery County government, Montgomery County Public Schools (MCPS), Montgomery College, and the Maryland-National Capital Park and Planning Commission (M-NCPPC) – according to their relative budget size. 

As part of this effort, the proposal calls for a uniform two percent general wage adjustment (GWA) for compensation for employees across all agencies, with no changes to increments. Under this proposal, every employee will receive salary increases, while helping eliminate an increase to the property tax. 

Additionally, the new budget approach would bolster County reserves by $50 million, strengthening the County’s position to maintain its longstanding Triple-A bond rating. The Council will continue its work reviewing budget allocations across each department and agency and will vote to adopt the final budget at the end of May.

Details on my proposal can be found here.

The aim of this budget approach is to shape a fairer, more sustainable future for everyone who calls Montgomery County home. I hope you can join me in supporting this effort.

Sincerely,

Natali Fani-González
Council President