Board forwards $295 million FY2026 budget recommendation to county amid concern over proposed state formula changes

The Saint Mary's County Board of Education voted Feb. 5 to approve and forward its recommended fiscal year 2026 operating budget to the commissioners of Saint Mary's County, while district leaders warned that pending state legislation could materially reduce state aid and force a larger local funding request.

Lewis McCord, a district staff member who presented the item, summarized the recommended budget and said it incorporates negotiated employee agreements, increases for health insurance and pension contributions and planned uses of fund balance for transportation retention stipends and workforce development. He told the board the recommended unrestricted operating budget totals $295,000,000 and that the request includes a 4% local funding increase (a $5,300,000 increase) to roughly $139.7 million as presented to the county.

District leaders emphasized two risks. First, enrollment declines have lowered projected state aid under the three‑year rolling average used by the Maryland State Department of Education. Second, the district flagged the governor's proposed "Excellence in Maryland Public Schools Act," which would change foundation and program formulas. Chairperson Bailey said: "A cut to collaborative time isn't really a cut to collaborative time. It's a cut to the foundation amount that drives the overall funding in every single public school in the state of Maryland." Dr. Smith, the superintendent, added: "We have entered into multi year agreements with our employees because we know that the 1 thing in this world everybody desperately needs is stability." Both speakers warned that changes to formula funding could compound over years and materially affect local budgets.

Using the state's current statute figures, district staff showed state aid for FY26 at about $147.5 million. They also presented a scenario using the governor's proposal that would reduce state aid by roughly $2.2 million for FY26 and, combined with pension pass‑through obligations, could require the district to seek an additional $9.1 million from the county to maintain the budget as presented. Staff explained the cumulative long‑term impact could reach tens of millions over the coming decade under some scenarios.

Board members pressed staff on specifics (enrollment change impacts, the $700,000 recurring savings from the proposed reduction of 10 positions, the use of fund balance and adjustments to textbooks and maintenance line items). Staff said the budget reduced positions by 10 in response to declining enrollment, trimmed one‑time textbook and plant maintenance spending and preserved negotiated compensation increases as committed in multi‑year agreements.

The board approved the recommended FY2026 budget and directed staff to forward the package, along with the district's analysis of potential impacts of pending state legislation, to the county commissioners for their review. The motion passed on a voice vote; no roll‑call count was recorded in the transcript.

The board and staff said they will continue to monitor state action and return to commissioners if legislation alters state aid or requires changes to the county request.