Montgomery County Council committees will meet April 29 to review portions of the FY27 Operating Budget, including funding for the Office of the County Attorney, Department of Finance, debt service, public safety agencies, housing programs and tax policies.
The Government Operations Committee will examine compensation, property and income tax proposals, including a potential income tax increase and discussions around restructuring tax credits, while the Public Safety and Planning, Housing and Parks committees will review budgets for agencies such as MCFRS, OEMHS and housing programs. The meetings will also include review of agreements, funding allocations and potential policy changes that could impact County services, taxes and budget priorities moving forward. Full agenda below courtesy Montgomery County:
“The Government Operations and Fiscal Policy (GO) Committee will meet on Wednesday, April 29 at 9:30 a.m. to review the Fiscal Year (FY) 2027 Operating Budget for the Office of the County Attorney, the Department of Finance, Risk Management Non-Departmental Account (NDA), Debt Service, State Property Tax Services NDA and the Working Families Income Supplement NDA. In addition, the committee will review property tax and income tax rates and the Income Tax Offset Credit (ITOC).
The members of the GO Committee include Chair Kate Stewart and Councilmembers Shebra Evans and Sidney Katz.
The Public Safety (PS) Committee will meet at 1:30 p.m. to review the FY27 Operating Budget for the Office of Emergency Management and Homeland Security (OEMHS), the Office of Consumer Protection and the Montgomery County Fire and Rescue Service (MCFRS). In addition, the committee will review a memorandum of agreement (MOA) for FY27 between the County and the Montgomery County Volunteer Fire Rescue Association (MCVFRA).
The members of the PS Committee include Chair Katz and Councilmembers Dawn Luedtke and Kristin Mink.
The Planning, Housing and Parks (PHP) Committee will meet at 1:30 p.m. to review the FY27 Operating Budget for the Housing Opportunities Commission NDA, Board of Appeals, Office of Zoning and Administrative Hearings (OZAH) and the Office of the People’s Counsel.
The members of the PHP Committee include Chair Andrew Friedson, Council President Natali Fani-González and Councilmember Will Jawando.
More detail on each agenda item is provided below.
Review: The GO Committee will review the $11.2 million recommended FY27 Operating Budget for the Office of the County Attorney, which represents an increase of $581,203, or 5.4 percent, compared to the approved FY26 Operating Budget. The change is largely due to a $463,919 increase for compensation adjustments, $23,172 to add an AI-powered document tool and $21,930 for an increase to a legal research subscription service.
Review: The GO Committee will review the recommended FY27 Operating Budget for the Department of Finance, Risk Management Non-Departmental Account (NDA) and the State Property Tax Services NDA. The entirety of the recommended budget for these three items is comprised of compensation adjustments and other cost increases which generally reflect a continuation of current staffing and service levels.
The County Executive recommends $139.5 million for the Department of Finance FY27 Operating Budget, which represents an increase of more than $1.6 million, or one percent, compared to the approved FY26 Operating Budget.
The County Executive recommends $26.9 million for the Risk Management NDA FY27 Operating Budget, which represents an increase of $2.4 million, or 9.8 percent, compared to the approved FY26 Operating Budget. This Risk Management NDA funds the General Fund contribution to the Liability and Property Coverage Self-Insurance Fund.
The County Executive recommends $7.2 million for the State Property Tax Services NDA FY27 Operating Budget, which represents an increase of more than $1.2 million, or 20 percent, compared to the approved FY26 Operating Budget. This NDA reimburses the state for four programs that support the property tax billing administration. The change is due to an increase in the state Department of Assessments and Taxation Reimbursement cost.
Review: The GO Committee will review the $525 million recommended FY27 Operating Budget for Debt Service, which represents an increase of $52.5 million, or 11 percent, compared to the approved FY26 Operating Budget. The Debt Service budget reflects obligations on the part of the County to pay debt incurred for past and upcoming FY27 spending decisions. The budget comprises the annual debt service obligation of all outstanding general obligation bond issues, long- and short-term lease payments, other long-term debt and projections of certain related expenditures.
Property Tax Rate and Income Tax Offset Credit (ITOC)
Review: The GO Committee will review the County Executive’s recommendations for the real property tax rate and ITOC. The proposal includes a weighted real property tax rate of $1.0885 per $100 of assessed value that includes a 6.3 cent increase to the Montgomery County Public Schools (MCPS) supplemental rate from the FY26 weighted real property tax rate of $1.0255 per $100 of assessed value. The County Executive has proposed an ITOC value of $692 for all eligible properties, which is the same as credit granted in FY26. The ITOC provides a tax credit to owner-occupied properties in the County.
Council President Natali Fani-González has proposed a new approach to the operating budget focused on reducing the tax burden on residents that includes using the ITOC expenditures to support creating a progressive income tax structure. If adopted, the Council would reduce the ITOC to zero. This action would increase tax-supported revenues by $139.7 million. These additional revenues would offset the decrease in income tax revenues from the proposed income tax rate structure. Additional details about the Council President’s income tax proposal, ITOC, and Working Families Income Supplement are also included in the Council staff report about the income tax resolution.
Resolution to set the Income Tax Rate
Review: The GO Committee will review the County Executive’s proposal to increase the County income tax rate from 3.2 to 3.3 percent of an individual’s Maryland taxable income for the taxable year beginning after Dec. 31, 2026, and subsequent years. Montgomery County’s income tax rate was set at 3.2 percent for the FY04 Operating Budget, the maximum rate allowed for that fiscal year. The Council does not annually approve an income tax rate, like it does for the property tax rates. The current rate remains in effect until the Council adopts a new resolution to change the rate. The resolution can be found in the Council staff report.
As noted above, Council President Fani-González has proposed creating a progressive income tax structure. The result of this structure allows those who earn less to have a lower effective tax rate than those who earn more. If the Council supports the Council President’s proposal, or any version of it, the Council will lower the tax rate for all taxable income reported within those brackets. For example, a tax rate of 2.5 percent on taxable income up to $50,000 means that every household’s income, up to that amount, is taxed at the new rate regardless of total income reported.
When considering marginal tax brackets, the Council may create as many or as few brackets as it decides. The only restrictions in the state law are: 1) the Council may not reduce the tax rate below 2.25 percent for any tax bracket; 2) the Council may not exceed 3.30 percent for any tax bracket; and 3) the Council cannot set a lower tax rate for higher-income brackets than lower-income brackets.
Working Families Income Supplement NDA
Review: The GO Committee will review the $36.1 million recommended FY27 Operating Budget for the Working Families Income Supplement, which represents an increase of $4.8 million, or 15.4 percent, compared to the approved FY26 Operating Budget. The Working Families Income Supplement provides funds to supplement the state’s refundable Earned Income Tax Credit (EITC) and is intended to benefit low income working families in the County. The recommendation includes a four percent increase, or more than $3 million, to the County match to the state for the Working Families Income Supplement. The increase also includes more than $1.7 million to realign annual appropriation with actual expenses invoiced by the state.
Council President Fani-González’s budget proposal would remove the County’s Working Families Income Supplement in favor of implementing a progressive income tax structure. Any Council action to change the Working Families Income Supplement would not impact the ability to receive the State Earned Income Tax Credit, which is the largest portion of the total tax credit received by eligible individuals and families.
Office of Emergency Management and Homeland Security (OEMHS)
Review: The PS Committee will review the $7.4 million recommended FY27 Operating Budget for OEMHS, which represents an increase of more than $1.7 million, or 30 percent, compared to the approved FY26 Operating Budget. The change includes funds to replace items previously funded by the Urban Area Security Initiative Grant. This includes $800,000 to replace the Everbridge Alert System, also known as Alert Montgomery; $425,000 for response equipment; and $93,274 to replace a Fiscal and Administrative position.
Review: The PS Committee will review the nearly $3.3 million recommended FY27 Operating Budget for the Office of Consumer Protection, which represents an increase of $97,005, or three percent, compared to the approved FY26 Operating Budget. The increase includes $104,612 for compensation adjustments and $2,393 for required operating expenses. The recommendation provides same-services budget and does not include any programmatic or staffing enhancements.
Montgomery County Fire and Rescue Services (MCFRS)
Review: The PS Committee will review the nearly $312 million recommended FY27 Operating Budget for the MCFRS, which represents an increase of $1.6 million, or one half of a percent, compared to the approved FY26 Operating Budget. The recommendation includes more than $8.7 million increase for compensation adjustments and a net reduction of more than $7.1 million for other items. The recommendation generally reflects a continuation of current staffing and service levels.
Review: The PS Committee will review the FY27 MOA between the County and MCVFRA. The term of the MOA is July 1, 2026, through June 30, 2029. The County Code requires the County Executive to submit to the Council any element of an agreement with the authorized local fire and rescue department representative that requires an appropriation of funds, may have a future fiscal impact, is inconsistent with any County law or regulation or requires the enactment or adoption of any County law or regulation. The Council must notify the parties within 60 days if it disapproves of an agreement in whole or in part. The Council may by resolution extend the time for action. Details about the provisions of the MOA that are subject to Council review for FY27 can be found in the Council staff report.
Housing Opportunities Commission NDA
Review: The PHP Committee will review the more than $9.5 million recommended FY27 Operating Budget for the Housing Opportunities Commission NDA, which represents an increase of $378,371, or 4.1 percent, compared to the approved FY26 Operating Budget. The increase is comprised of compensation adjustments and required operating expenses that reflect a continuation of current staffing and service levels. The Housing Opportunities Commission (HOC) has requested an additional $2.89 million in funding for two programmatic enhancements. The County Executive’s recommended budget does not provide funding for these items. The HOC has also proposed a change to the Council’s annual budget resolution to allow the HOC’s Commission to grant short-term extensions for Housing Production Fund loans. Additional details are available in the Council staff report.
Review: The PHP Committee will review the $626,130 recommended FY27 Operating Budget for the Board of Appeals, which represents an increase of $17,796, or nearly three percent, compared to the approved FY26 Operating Budget. The increase is comprised of compensation adjustments and required operating expenses that reflect a continuation of current staffing and service levels.
Office of Zoning and Administrative Hearings
Review: The PHP Committee will review the $852,436recommended FY27 Operating Budget for the OZAH, which represents a decrease of $30,760, or nearly 3.5 percent, compared to the approved FY26 Operating Budget. The recommendation includes the elimination of one-time items approved in FY26 and an overall decrease in compensation adjustments and required operating expenses that reflect the continuation of current staffing and service levels.
Office of the People’s Counsel
Review: The PHP Committee will review the $202,445 recommended FY27 Operating Budget for the Office of the People’s Counsel. For FY23, FY24, FY25 and FY26 the Council did not recommend funding this office. The Office of the People’s Counsel was last funded in FY10 with a budget of $246,520. During review of the FY11 Operating Budget, the Council’s former Planning, Housing and Economic Development Committee recommended not appropriating funds for the OPC. The Council concurred with this assessment, and the office has not been funded since this time.”
