Allegany County commissioners agree to 2¢ property tax increase, raise local income tax to 3.2% to close FY26 gap

Allegany County Commissioners on Thursday directed staff to advertise a 2¢ increase in the county property tax rate and to move the local income tax to the maximum allowable 3.2% for calendar-year 2026, measures county staff said are intended to close a roughly $1.1 million gap in the fiscal 2026 budget.

County staff told commissioners that current FY26 revenue projections total $112,387,112 against $113,499,732 in expenditures, producing about a $1.1 million deficit. The draft budget already includes several state-driven changes and cost increases, including a projected $825,000 in pilot revenue from wind-turbine operations (pending those facilities reaching operation), a $754,000 teacher-pension shift and an increase in health insurance and retirement costs (staff said health insurance is up about 16% and Maryland retirement costs roughly 11%). Staff also noted a roughly $816,000 reduction this year in the county—s supplemental disparity grant and further cuts expected next year.

To address the shortfall, commissioners approved a package of measures to be advertised for public hearing: raise property taxes by 2¢, push the local income tax to the 3.2% cap, level-fund the library (eliminating an $87,000 request for additional county funding), eliminate 10 county positions (estimated to reduce costs by roughly $775,000), and use a mix of lottery funds and fund balance to bridge the remaining gap. County staff said they would begin the legal…