Howard County Council adopts FY2026 budget after extended debate over school funding and one-time cuts

The Howard County Council on Tuesday approved the county's fiscal year 2026 operating and capital budget after several hours of amendments and debate, voting unanimously to pass the budget ordinance (CB 36-2025) and a separate emergency measure that directs $14.5 million in excess surplus to the Howard County Public School System (CB 45-2025).

The adoption came after multiple amendment votes and sustained discussion over whether to tap one-time reserves, fleet and PAYGO funds, or school health and fund-balance accounts to close the school system's budget gap. Chair Walsh moved the final budget ordinance and called the roll; the final vote on CB 36-2025 as amended was recorded as unanimous (Chair Walsh: yes; Dr. Jones: yes; Ms. Young: yes; Ms. Rigby: yes; Mr. Youngman: yes).

Why it matters: The votes resolve the county's spending plans for FY2026, including operating allocations for public safety, libraries and higher education, and a high-stakes debate over school funding that centered on whether to use recurring versus one-time dollars and which internal accounts the school system should be asked to access.

Council action and the school debate

Council members approved CB 36-2025 — the budget and appropriation ordinance for FY2026 — after a sequence of amendments addressing technical corrections, capital funding swaps, program-specific changes and targeted operating adjustments. Earlier in the session the council approved CB 45-2025, the emergency measure authorizing use of excess surplus revenue “up to $14,500,000” for the Board of Education; that bill also passed on a unanimous vote.

Several amendments that would have moved additional one-time funds to the school system failed. Council member Walsh — who sponsored a floor amendment that sought roughly $8,000,000 in additional support by restoring PAYGO and reducing certain fleet and other internally charged items — framed the proposal as an attempt to avoid drawing on the school system's health fund. Walsh said the amendment aimed to “find the $8,000,000 that's needed to plug that specific hole proposed by the executive in his May 8 letter so that the school system does not have to get into its health fund.” The motion to add that $8 million (moved as Amendment 3 to Amendment 2) failed on a 3–2 vote.

Council members who opposed further reallocations cited the county's use of one-time reserves this year and concern for credit ratings and future borrowing costs. Ms. Rigby noted a written assurance from the county executive that he “remains committed to ensuring that the health benefit expenses of the school system are met, and that HCPSS health fund does not enter a deficit,” language she read from a superintendent or executive communication into the record. Other council members stressed that the school system and the administration were already negotiating options and that further reallocations would risk the county's reserve and borrowing posture.

Key amounts and items discussed

- CB 45-2025: Authorized use of up to $14,500,000 of excess surplus revenue to support the Board of Education for FY2026; passed unanimously. - CR 92-2025 (Board of Education FY2026 operating budget) was amended to add $5,000,000 in state aid and the $14,500,000 in excess surplus revenue and passed as amended. - CB 36-2025 (FY2026 budget and appropriation ordinance) was approved as amended; the council adopted multiple operating and capital adjustments, including technical corrections and program changes described below. - Sponsor-proposed adjustments: Walsh and others proposed restoring PAYGO funding to certain school-support projects and offsetting those restorations with cuts to fleet replacement, parks resurfacing and other one-time or chargeback items; many of those specific reallocation proposals failed to gain the votes necessary to pass. - OPEB and reserves: Council discussion referenced a proposed $2.5 million one-time OPEB contribution in the FY2026 proposal and subsequent amendment activity that removed or restored portions of that contribution in different motions. - Fleet and chargebacks: Council sponsors proposed reductions to fleet replacement and internal chargeback transfers (including a stated $1,250,000 general fund chargeback reduction and approximately $515,000 in fleet reductions tied to shifting to hybrid vehicles), citing lower projected fuel usage and a multi-year modernization plan.

Explanations from staff and subject-matter witnesses

County finance and legal staff addressed the council's questions during debate. Finance staff explained that a proposed $200,000 reduction in debt-service for commercial bond anticipation notes reflected the difference between budgeted and expected interest costs on the county's line of credit, which was described as a short-term borrowing instrument that supports capital projects prior to bond issuance. Mr. Cook (Office of Law/Finance counsel) and other staff warned that the council cannot legally cut debt service on obligations that are already outstanding.

Fleet staff were cited during the discussion. Council members credited Fleet Manager Robert Phillips for increasing the number of hybrid replacements in the vehicle schedule; sponsors said that modernization made modest reductions in the FY2026 fleet appropriation defensible while retaining funding for public safety vehicle needs.

Votes at a glance (selected measures)

- CB 36-2025, Budget and Appropriation Ordinance, FY2026 — PASSED (as amended). Final recorded vote: Chair Walsh: yes; Dr. Jones: yes; Ms. Young: yes; Ms. Rigby: yes; Mr. Youngman: yes. - CB 45-2025, Use of excess surplus revenue up to $14,500,000 for Board of Education (Emergency Act) — PASSED (unanimous). - CR 92-2025, Board of Education FY2026 operating budget (as amended to add $5,000,000 state aid and $14,500,000 excess surplus) — PASSED (as amended). - SAO 1 FY2025, Department of Public Works supplementary appropriation ($2,000,000) — PASSED. - CB 34-2025, FY2026 pay plan (and associated technical corrections and schedule fixes via amendments) — PASSED (amendments adopted; final passage recorded yes by all council members present). - Multiple capital bond bills and related resolutions (CB 37, CB 38, CB 39, CB 40, CB 41, CB 42, CB 43, CB 44; CR 89, CR 89 as amended, and related amendments described in the record) — PASSED (see minutes for roll-call details on each item).

What the council decided not to do

Several floor amendments aimed at shifting additional recurring or one-time funds to the Howard County Public School System did not pass. Notably, a plan to find an additional roughly $8,000,000 by reducing PAYGO, fleet and other county charges failed; sponsors described that as a deliberate effort to avoid asking the school system to use its health fund, but the motion did not receive the votes to carry.

Context and next steps

Council members emphasized that the decisions made in this session include a mixture of recurring and one-time funding, and several members warned that reliance on one-time reserves will limit the county's flexibility in future years as federal and state revenue uncertainty continues. Council members asked the administration to provide written assurances and more detailed progress reports on certain capital project funding and on any guarantee related to the school system health fund; the administration's written pledge on health benefits was read into the record by Ms. Rigby during debate.

The council adopted reporting and technical amendments for capital projects, instructed staff to provide quarterly updates on project budgets and funding sources, and finalized appropriations across operating and capital funds. With the package approved, county staff will proceed with implementation of the FY2026 operating and capital plans and with the administrative steps (signatures, publication and encumbrance) required under county rules.

Ending

The council concluded the special legislative session after completing the votes and offering closing statements; several members reiterated concerns that the school system will remain a priority for future budget cycles and urged continued collaboration among the superintendent, the Board of Education and the county executive to manage year-end adjustments and mid-year changes.

Votes and roll-call records for each bill and amendment are reflected in the council transcript and the official minutes filed by the council administrator.