Montgomery County Council

Budget Update

 

On May 22, 2025, the Montgomery County Council voted unanimously to approve the County’s $7.6 billion Fiscal Year (FY) 2026 Operating Budget and the $6 billion amended FY25-30 Capital Improvements Program (CIP). The FY26 Operating Budget holds the line on property and income tax rates, makes historic investments in Montgomery County Public Schools, and provides enhanced support for social safety net services. Montgomery County’s fiscal reserves are also maintained at more than 11 percent.

“Budgets are guiding documents that establish priorities, reflect community needs, and underscore values,” said Council President Kate Stewart. “Montgomery County’s Fiscal Year 2026 Operating Budget funds our collective and essential priorities to meet the critical needs of our wonderfully diverse community today, with an eye toward our ever-changing fiscal future. We have continued our unyielding commitment to support education, public safety, social safety net services, and our dedicated employees who are essential to all areas of public service. 

“Public input was essential to constructing this budget. I’m proud that we did not turn away anyone from any public hearing, as we listened to the views of more than 300 residents during our budget hearings. We also reviewed thousands of emails, took hundreds of calls, and met with numerous groups.

“We understand the impact that federal job losses are having on households across our community and the Washington metropolitan region, with families facing higher levels of financial stress, spending cutbacks, and uncertain futures. In the face of erratic cuts at the federal level and new ongoing financial obligations passed down from the state, we put the needs of our community front and center by holding the line on property tax and income tax rates while maintaining public services. Additionally, this budget maintains our strong fiscal stewardship that has enabled Montgomery County to weather economic storms and helps to maintain our AAA bond rating, which remains the hallmark of well-run governments across the nation.”

The Council’s approved budget provides funding to support Montgomery County Public Schools (MCPS), Montgomery College, and essential educational and cultural services in Montgomery County. Funding $3.6 billion for MCPS comprises half of the County’s overall budget and is 99.8 percent of the Board of Education’s request. MCPS will receive $50 million from the pre-funding of the retiree health benefit trust. The use of one-time funds will assist MCPS in meeting its payments for retiree benefits, address cash flow issues, and make other funds available to MCPS to address needs as it takes action on its three-year plan to address escalating health care costs.

In addition, the Council approved funding to support County transportation and environmental initiatives. Notably, the Council voted to eliminate fares for all riders on Ride On buses to promote transit equity, encourage ridership growth, and make the County bus system easy to use for current riders. The Council also voted to approve numerous recreation, parks, and planning programs.

The Council approved funding to enhance public safety and approved economic development initiatives focused on job creation and business attraction and development.  In addition, the Council voted to approve funding for housing programs to create and to preserve affordable housing and numerous health and human services programs that residents rely on for health care, social safety net services, and older adult and youth services.

The amended FY25-30 Capital Improvements Program (CIP) totals approximately $6 billion, a $32.6 million increase from the original approved FY25-30 CIP. The CIP continues support for critical projects for education, housing, economic development, and transportation.   

The capital and operating budgets go into effect on July 1. View  Council President Stewart's remarks on the FY26 budget. In addition, watch the  Council’s May 15 straw vote on the budget and watch the  Council's final budget vote.