SMCPS projects enrollment decline for 2026–27, shifts to deeper zero‑based budgeting for FY27

St. Mary's County Public Schools told the board Wednesday that enrollment is down and the district will apply a deeper zero‑based budgeting process as it develops its FY2027 budget.

Finance staff presented preliminary, unaudited enrollment estimates showing 16,370 students in the prior year (a decrease of 329 students) and an estimated 16,171 for the current school year, a decrease of 199 students. The district's three‑year rolling average — used for maintenance‑of‑effort calculations — was reported at 16,413, a decline of 227 students.

That decrease will affect state foundation and program funding, presenters said. The law currently sets the FY2027 foundation amount at $9,561 per pupil; compensatory (poverty‑related) funding is estimated to decline from $7,842 to $7,786 per pupil; prekindergarten funding is scheduled to rise to $19,950 per pupil; and special‑education funding is projected at $10,900 per pupil, presenters said. The district cautioned that state legislative action could change those figures between now and April.

The district also noted uncertainty in state revenue forecasts: the Maryland Comptroller's 90‑day analysis and legislative forecasts indicate economic and revenue volatility that could affect state school aid in 2026–27.

To respond, SMCPS said it will expand its modified zero‑based budgeting work into a fuller zero‑based review for FY27. That approach will require departments to justify all line‑item requests, provide vendor quotes where applicable, and allow fiscal staff to reallocate resources across departments and schools based on current student needs. Budget development milestones include department submissions in October, superintendent's recommended budget in January, and board adoption in May; the board will submit its request to the county commissioners in February for their consideration.

Administrators described existing analytic steps already taken — individualized payroll forecasting, staffing‑allocation reviews, deep analysis of health‑insurance enrollment and utility consumption — and said the FY27 cycle will drill deeper into curriculum software, custodial and transportation contracts, and program return on investment.

Board members asked about impacts on targeted student groups. Presenters noted that reductions to transitional supplemental instruction (TSI) funding and a 1% cut to compensatory funding would modestly reduce per‑pupil support for high‑need students; the district said it will continue to monitor enrollment and state budget developments and adjust proposals accordingly.