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Montgomery County work group examines new funding options for schools, transportation and parks
Summary
Planning staff told a joint meeting with Montgomery County Public Schools that a council‑created infrastructure funding work group is reviewing revenue options — including an excise tax on square footage, changes to the impact‑tax system, real property tax revenue, special taxing districts and possible sales‑tax dedication if authorized by the state — and will submit recommendations by June 30, 2026.
A county planning official said Montgomery County’s infrastructure funding work group is exploring a range of revenue options to stabilize funding for schools, transportation and parks.
"We have no recommendations yet," Lisa Gooni, policy supervisor in the planning department, told the joint meeting of the Montgomery County Planning Board and Montgomery County Public Schools on Tuesday. The work group was created by a March 2025 council resolution and must report back to the council by June 30, 2026.
The group has conducted stakeholder outreach since August and is reviewing how the county’s capital budget is funded, how impact and recordation taxes affect economic development, and how to balance new revenue with other county priorities such as housing and climate resiliency. Gooni listed candidate approaches discussed so far: using additional current revenue, preserving or altering the existing one‑time impact tax, an excise tax based on square footage, a recurring real‑property tax levy, special taxing or development districts (including tax‑increment financing), and—if the state grants authority—dedicating sales‑tax revenue.
Planning staff said the review will weigh equity, predictability and sustainability of each option. They emphasized that construction and project costs have risen, that infill development in the county typically has different school impacts than greenfield development, and that external (state or federal) funding remains an important source for capacity projects.
When a board member asked whether income tax had been discussed as a possible revenue source, staff said income tax had not been considered to date but that they could take the suggestion back to the work group.
The work group’s near‑term tasks are to finalize findings, solicit further public and private‑sector feedback on revenue options, analyze distributional and programmatic impacts, and complete a report to the County Council by the end of June 2026. Planning staff noted the review is exploratory and no policy changes have been proposed or approved yet.
Next steps: the work group will continue stakeholder outreach, finalize revenue recommendations with equity and predictability analyses, and submit the formal report to the County Council by June 30, 2026.
