PGCPS warns a mix of enrollment gains and proposed state cuts could widen a $37M gap to as much as $63M

Prince George’s County Public Schools officials told the Board of Education’s Operations, Budget & Fiscal Affairs Committee on Jan. 29 that preliminary state aid calculations increase some revenue for the district but that pending legislation at the Maryland General Assembly could reduce funding and widen an existing $37 million shortfall to about $63 million.

The update, presented by Chief Financial Officer Lisa Howell and Budget Director Siobhan Smith, explained how Sept. 30 enrollment counts and the state’s “Blueprint” funding formula drive the district’s state aid. With final eligible enrollment slightly higher than the figures used in the superintendent’s proposed FY2026 budget, the district is seeing increases in some targeted funding streams — but those gains may be offset if bills moving through Annapolis become law.

Why this matters: The district’s largest funding source, foundation aid, and other Blueprint-linked programs must direct at least 75% of that money to schools. A reduction in those streams would force the district to consider program or staffing reductions at schools, reallocation of central-office dollars or other offsets to produce a sustainable budget.

Siobhan Smith, the budget director, said one pending measure would delay the state’s collaborative time program and that “this delay would decrease expected per pupil revenue by $163 for foundation,” a change that ripples into other Blueprint programs. Smith also summarized other pending measures — including proposals to increase local retirement contributions and to alter the state’s nonpublic placement mandate — that the district estimates could combine to reduce total revenue.

At the committee meeting Smith presented preliminary state aid calculations dated Jan. 17 and two revenue scenarios in the district’s requested budget: (1) revenue based on current law and the governor’s budget, and (2) a scenario that layers in the fiscal effects of pending legislation. Under current preliminary calculations, total operating revenue increased modestly versus the fall proposed budget and yielded some restricted-fund increases that would partially close the district’s existing gap. But if the pending bills pass, the administration told the committee it would see reductions that add roughly $25.7 million to the district’s budget gap on top of a roughly $37 million deficit the district is already trying to close — producing the about $63 million figure cited repeatedly at the meeting.

The presentation broke down program-level changes in the pending-legislation scenario: an estimated decrease in foundation funding of about $2,040,000; a decrease in compensatory education (the district’s “FARM” funding) of about $1,180,000; a decrease in the comparable wage index of roughly $120,000; and partially offsetting increases tied to higher eligible enrollments for multilingual learners (about $570,000) and special education (about $2,000,000). Smith stressed these figures are preliminary and subject to change as the General Assembly’s fiscal notes and final student counts are certified.

Chief Financial Officer Lisa Howell reminded board members that the district educates all students who come to its doors even when some are not eligible for state aid and urged members to seek cost-neutral amendments during the budget amendment process. "We can't cut our way out of this through central office," Howell said, noting that most costs are people and school-based services and that the district’s legal minimum school funding rules mean reductions will fall heavily on schools.

Board members pressed staff for clarity about the $63 million figure and requested a single slide showing the components that produce that total. "Is there a way for you all to help me make sense of the potential $63,000,000 across the board?" asked Dr. Felton Moss, District 7 Board Member.

The committee also reviewed the amendment and calendar timeline: board amendments to the superintendent’s proposed FY2026 budget are due Feb. 10; a committee-level review (OBAPA/BAFA meeting) is scheduled for Feb. 12 at 5:30 p.m.; the final work session to consider and adopt amendments before transmission to the county is Feb. 13; and the full board will vote to adopt the FY2026 requested budget on Feb. 27 so the district can transmit it to the county by March 1. Smith and Howell urged board members to submit amendments early and to include offsets for any increases so the administration can cost and incorporate them into the requested budget.

The presenters said the district is continuing a multiweek effort across divisions to identify internal efficiencies and potential offsets, and that some divisions have already used consultants for targeted operational reviews (transportation, human resources). The budget office is also working with a resource-allocation partner supporting Blueprint-related redistribution among schools.

Ending: The committee will reconvene virtually on Feb. 12 at 5:30 p.m. for further review of amendments and the requested FY2026 budget. The district cautioned that the legislative process in Annapolis is fluid; revenues and fiscal notes may change through April, requiring additional adjustments before the county adopts its budget.

Votes at a glance

- Adopt agenda for Jan. 29, 2025 (as amended): motion by Chair Zakiya Goins McCants — Approved, roll call tally: 4 yes (Vonta McCance; Robin Brown; Mr. Grace; Dr. Felton Moss). - Approve minutes of Dec. 11, 2024 meeting: adopted (no corrections reported). - Change committee meeting start time from 5:00 p.m. to 5:30 p.m.: motion by Chair Zakiya Goins McCants — Approved, roll call tally: 4 yes (Vonta McCance; Robin Brown; Jonathan Briggs; Dr. Felton Moss).