This year’s legislative session, which ended in mid-April, brought few changes to Maryland’s school funding landscape. Most school districts will see increases in state funding during the next school year, and lawmakers made minor legislative changes to keep Maryland’s education reform process (known as the Blueprint for Maryland’s Future) on track. However, severe challenges are just around the corner for Maryland schools. Inflation has already eroded the purchasing power of planned funding increases, and looming deficits will require policymakers to either raise significant new revenue or enact drastic education cuts as soon as next year.
Generally Positive Funding Trends
Adjusted for inflation and enrollment changes, state funding for public schools (not including support for retired educator pensions) will increase by 2% for the 2026–2027 school year (FY 2027):
- 22 of the state’s 24 county-based districts will see a funding increase
- Two districts will see a decline in inflation-adjusted state funding per pupil:
- Garrett County (–7.3%)
- Montgomery County (–0.1%)
- Four districts will see especially large increases:
- Caroline County (+5.2%)
- Somerset County (+4.8%)
- Calvert County (+3.3%)
- Worcester County (+3.2%)
Taking a longer view more clearly shows the benefits of the 2021 Blueprint for Maryland’s Future law. Statewide, school funding increased by a cumulative 11.7% over the five-year period from FY 2022 to 2027:
- 22 of the state’s 24 districts have seen funding increases
- Two districts have seen a five-year decline in inflation-adjusted state funding per pupil:
- Garrett County (–5.8%)
- Queen Anne’s County (–1.1%)
- Three districts have seen especially large five-year increases:
- Talbot County (19.1%)
- Harford County (18.2%)
- Worcester County (17.9%)
Garrett County’s conspicuous decrease in state funding is driven by increasing property and income wealth in the county. Like most other states, Maryland divides school funding responsibilities between the state and local jurisdictions based on local wealth – counties with higher property values and incomes are better able to raise local revenue and are therefore expected to contribute a larger share of their schools’ budgets. Garrett County’s wealth (as measured in the state’s funding formula) increased by 48% over the last five years, compared to a 29% statewide increase. The county’s income and property values both outpaced statewide growth, with property wealth growing especially rapidly.
Mixed Progress on Equity
One important goal of the Blueprint law is to make public school funding more equitable. Students who grow up in poverty, with a disability, or facing other barriers need extra support to succeed in school. Moreover, because centuries of racist policies have distributed income and wealth unequally, inadequate school funding tends to fall hardest on Black students and other students of color. For example, years of gradual cuts following the Great Recession left more than half of Black students in Maryland going to school in a district that was underfunded by 15% or more as of FY 2015.
Over the last five years, Maryland’s progress on school funding equity has been mixed:
- On average, districts serving higher percentages of Black students saw somewhat larger funding increases than other districts from FY 2022 to 2027.
- There was no relationship between child poverty and school funding increases during this period. Districts with higher child poverty rates saw the same increases in state funding as lower-poverty districts, on average.
- Funding data suggest that some districts serving higher percentages of students with disabilities saw above-average funding increases, but this relationship is too inconsistent to draw any firm conclusions.
Positive Legislative Action
Policymakers took two positive steps this year to prevent harmful funding cuts:
- The General Assembly approved a proposal from Gov. Moore and the state’s Accountability and Implementation Board to delay a planned change to the state’s methodology for counting students in low-income families. While the state needs to improve its poverty measurement methods, policymakers have not yet settled on an effective new approach. The methodology that would have taken effect this year without legislative action would have taken away about $229 million in much-needed funding. The enacted delay allows more time to build an appropriate measure without sudden, harmful budget cuts.
- The legislature rejected a proposal from Gov. Moore to permanently cut $20 million per year from a program to provide behavioral health services in schools (the Consortium for Coordinated Community Supports). On top of a $30 million per year cut enacted in 2025, this would have permanently reduced the program by 38% compared to its intended funding level. While lawmakers did not reverse last year’s cuts, they made the right choice in rejecting further reductions.
Inflation and Policy Choices Have Eroded Funding
While Maryland’s schools, children, and educators will see a meaningful increase in resources this fall, policymakers are falling significantly short of realizing the intentions behind the Blueprint for Maryland’s Future law.
Years of gradual cuts following the Great Recession left Maryland schools deeply underfunded, with the greatest harms for children of color and children in low-income families. The Blueprint held the promise to undo this harm, support innovative new strategies, and guarantee a great education to children of all backgrounds, from every part of Maryland. Fulfilling these promises requires additional resources.
Since lawmakers enacted the Blueprint in 2021, two things have changed:
- Prices throughout the economy have risen much more rapidly than expected – first due to supply chain disruptions in the wake of the COVID-19 pandemic, then again due to President Trump’s tariff policy and war in Iran. Because the Blueprint law relies on the typical inflation forecasted in 2021, rather than adjusting for inflation in real time, funding levels are not delivering as large of a boost in purchasing power as intended.
- In 2025, the General Assembly for the first time enacted legislation walking back Blueprint commitments, while rejecting deeper cuts proposed by Gov. Moore.
Two facts about the current state of school funding in Maryland may seem incongruous: adjusted for inflation, the FY 2027 per-pupil foundation amount is only 2.1% above its FY 2021 level, and less than 1% above its FY 2022 level; yet, most school districts have seen significant increases in total state aid (adjusted for inflation) since FY 2022. This is due largely to changes in students’ needs over the last five years, as well as improvements to how we measure those needs. Since 2022, Maryland has seen an increase in the number of students identified as having low family income, having a disability, or being English learners. Our funding formulas allocate additional funding for the services these students require to succeed. Put another way, while most school districts have seen their state funding increase, these increases have not necessarily been sufficient to serve their changing student populations amid rapidly rising prices.
Policymakers Must Choose: Revenue or Deep Cuts?
While economic trends and policy choices have already weakened the promises made to Maryland children, the greatest risks to education funding lie in the near future.
Under current policy, the state’s general fund faces a projected cash deficit of nearly $2.6 billion in FY 2028 (July 2027 to June 2028), increasing to $3.6 billion by FY 2030.
Like most states, Maryland’s constitution requires a balanced operating budget every year. In other words, by the end of the decade, policymakers will need to eliminate this gap with a combined $3.6 billion in new revenues or budget cuts. They could theoretically delay this choice by one year by drawing down savings, at the risk of leaving little financial cushion in case of a recession. These are the only realistic choices on the table.
If policymakers choose to rely solely on budget cuts, these will unavoidably include public schools, which account for more than a quarter of the state’s general fund budget.
A better choice would be to raise significant new revenue by closing big business tax loopholes and asking the wealthiest individuals to pay their fair share. Corporations and wealthy individuals just received a windfall under the President Trump’s 2025 federal megabill, far outweighing their increased responsibilities under last year’s positive state tax reforms.
Raising new revenue through fair tax reforms is essential if we wish to keep our promises to Maryland children and protect the public services we all rely on.