Howard County board reviews FY2027 revenue picture as enrollment decline lowers required local MOE

Howard County Public Schools staff told the Board of Education on Jan. 15 that the superintendent's proposed FY2027 operating budget totals $1,278,000,000 in expenditures, supported by projected revenues that are about $61.9 million (5.1%) higher than FY2026.

At a work session focused on revenue changes and "fees for service," Chief Financial Officer Brian Hall said state aid is projected to rise by roughly $10.1 million, county revenues are projected to increase by roughly $62 million, and other revenues are expected to decline largely because one-time transfers used in FY26 (from technology and health funds) are not available in FY27. Hall said staff plan to use about $3 million from the undesignated general fund balance in the proposed plan.

The most consequential driver for local required funding, Hall said, is enrollment. For FY27 the state's funding formula will use a three-year average enrollment of 55,681 students, a decline of 258 from the FY26 three-year average. That decline, Hall said, reduces the statutory maintenance-of-effort (MOE) requirement for Howard County by about $3.8 million, from an MOE-based total of $814.5 million down to approximately $810.7 million.

"MOE is maintenance of effort," Hall told the board. "It's a state requirement that the county fund at least the same per pupil level in the following fiscal year as it did in the previous fiscal year." He added that the MOE calculation indexes only to prior-year local funding and enrollment and does not capture rising per-pupil costs tied to Blueprint implementation, compensation, or inflation.

Darren Conforti, executive director of budget, told the board a recent legislative change is shifting the cost share for some nonpublic placement tuition. Conforti said the state's prior 70/30 cost split has moved to 60/40 in FY26 and will reach 50/50 in FY27, and he projected the system added roughly $2.5 million in FY26 for the initial shift and expects an additional $3 million—$4 million impact in FY27.

Board members pressed staff for more detail on the enrollment counts used by MSDE and for a breakout of subpopulation changes (special education, multilingual learners, compensatory education). Hall and Conforti said the official state revenue counts and MSDE's preliminary projections will be available later in the month and staff will provide updated charts and a crosswalk aligning budget proposals to the HCPSS strategic plan.

Votes at a glance - Approval of agenda: motion carried, 7-0 (board roll-call vote). - Administrative appointments and promotions: motion carried, 5 yes, 0 no, 1 abstention (Miss McCoy).

Why it matters The board must balance growing programmatic demands—including increased per-pupil state funding in specific areas such as special education and pre-K—against an enrollment decline that, under Maryland's statutory MOE rules, reduces the district's required local funding floor. The result is a widening gap between the costs of new initiatives and the formulaic local requirement, meaning the district must either reallocate existing funds, seek more county dollars, or implement revenue measures.

Next steps Staff will update the board as MSDE releases its preliminary state aid and enrollment counts later in January. The board has scheduled additional work sessions (Jan. 22 and Feb. 5) to review expenditure changes tied to the HCPSS strategic plan priorities and will consider motions to modify the superintendent's proposed budget at the Feb. 26 adoption meeting (March 3 reserved if needed).