Dorchester County projects $7.7 million FY26 shortfall; officials propose $2.1M in capital cuts and fee, tax options

Dorchester County officials said a projected $7,740,000 shortfall for fiscal 2026 is forcing a mix of capital reductions and potential new revenues, including a proposed 911 line fee increase and ending long-standing municipal tax differential payments.

County staff presented the update at a budget work session and described the shortfall as driven largely by proposed state reductions and lower local revenue projections. With last year—s $2,449,000 surplus removed from the FY26 plan, staff said the county faces a larger gap that they are working to close through departmental cuts, capital deferrals and revenue changes.

The budget situation matters because county officials say the remaining gap could require either a property tax increase or other measures that would affect residents and county services. County staff calculated that each one-cent increase in the property tax rate yields about $340,000; covering the full projected shortfall without other changes would require roughly a 12-cent increase, officials said. Staff cautioned the numbers remain fluid pending action in the Maryland General Assembly and the governor—s review.

Staff numbers and proposed changes

County staff said the state-level actions account for roughly $5,600,000 of the current impact on Dorchester County. The full revenue-to-expenditure gap shown at the meeting was about $7,740,000; removing…