By Adam Pagnucco.
While County Executive Marc Elrich has proposed an FY26 operating budget with a property tax hike, a gigantic solid waste fee increase and a half-billion dollars in new spending (a 7.4% increase), Howard County Executive Calvin Ball is proposing an FY26 operating budget with no tax hikes, an overall spending cut and more money for schools. Facing similar pressures as Montgomery County, how was Ball able to pull this off?
Howard County Executive Calvin Ball. From Howard County government’s website.
First, about those similar pressures. Like MoCo, Howard faces adversity from both the federal and state levels. Here is what Ball wrote about the federal government.
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The FY26 Operating Budget was developed under conditions of great uncertainty that have been amplified by major workforce and funding changes at the federal level.
In Washington, the new federal Administration has taken sharp actions to reduce the federal workforce, which has a disproportionate impact on Maryland and Howard County. Approximately 11% of Howard County’s workforce are direct employees of the federal government, and we estimate that at least the same amount are federal contractors or working for federally funded organizations or programs, indicating that approximately one fourth of Howard County’s workforce will be exposed to federal funding and workforce decisions.
Furthermore, the federal government spent approximately $6.1 billion in federal procurement to Howard County-based firms in 2024, one of the highest amounts in the state. This reflects significant investment in the private sector through federal contracting relationships, which suggests high risk exposure when the federal government is in process of cutting contracts. For Howard County, this significant federal impact means that our anticipated revenues in FY26 are extremely susceptible to changes at the federal level.
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Ball also discussed the state’s shift and shaft items, which have heavily hit MoCo. He wrote:
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For Howard County, these shifted state costs include:
Pension liabilities for Howard County Public School System (HCPSS) teachers to Howard County, at a cost of $6.7 million. These costs are mandatory, are not folded into the HCPSS required Maintenance of Effort funding and are directly billed to Howard County Government.
Redirecting 90% of the costs associated with the Maryland State Department of Assessments and Taxation (SDAT) to Howard County, at an additional cost of approximately $1.1 million on top of the current 50% share.
Pension costs for community college employees to Howard County, at a cost of $200,000.
For Howard County, cost shifts and new state requirements equate to approximately $8 million in unanticipated costs that must now be paid directly by Howard County Government in the upcoming fiscal year.
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Ball writes, “The total proposed FY26 Operating Budget of $2.3 billion represents a 1.6% decrease from the FY25 budget, reflecting a more uncertain fiscal outlook. The General Fund, which supports most government services, totals $1.63 billion, which also decreases by 1.6% from FY25. These decreases are primarily due to fewer one-time resources.” How did Ball accomplish this spending reduction? Here is his game plan.
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As a local government, we have a duty, obligation, and requirement to propose a balanced budget. Facing this gap, my team has worked extremely hard to develop various strategies to support strategic priorities without increasing taxes on our residents, laying off County employees, or compromising essential services. To address the funding gap, this budget deploys several cost savings measures and cuts within County government:
First, we immediately paused hiring for approximately 40 positions in county government. These are currently unfilled positions in county departments and offices. While these positions are important for delivering services, we are prioritizing public safety and core functions within departments. These positions will remain partially or fully frozen during FY26.
Second, we are aligning with our surrounding counties in Maryland and reducing our employer-employee health contribution ratio. Starting January 2026, the County will pay 85% of the healthcare premium costs for employees, a decrease from the current ratio of 90%. As a result, County employees will see an increase in their healthcare contributions. This was a difficult choice, but we are asking our entire workforce to share the burden of this cost shift.
Third, we are optimizing and reducing technology, mobile communications, and internal county transportation costs to promote efficiency and realize savings. This will save on technology costs, fuel, vehicle maintenance, and more.
Fourth, we are reducing travel, printing, and training costs across the County by nearly 10% below the prior year’s budget.
Fifth, we are implementing Energy Savings Days for non-critical County Government buildings. Targeted on days that are close to county holidays and long weekends, the County will close buildings and reduce energy usage at many of our major buildings, serving to reduce energy costs. Buildings for employees working in essential in-person positions, such as public safety, will not be affected. Employees in buildings impacted will be subject to our telework policy. As part of these efficiency efforts, we will reduce water, paper consumption, and energy usage, while ensuring that our buildings remain secure. Additionally, this will limit public-facing services offered in those buildings on those days.
Finally, we have made overall cuts to County budget requests for FY26 and minimized new initiatives in our Departments and Offices.
Through this process, we have worked hard to preserve the current employees who work tirelessly to serve our County, ensuring that no one loses their job in this proposed budget. Through these county government actions, we are also working with intention to avoid employee furloughs at this time. I want to emphasize that our revenues and our budget remain very susceptible to changes at the federal level, and we will need to continuously evaluate the evolving fiscal situation throughout the upcoming fiscal year.
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What about schools, a long-time strength of Howard County? Ball is increasing spending for the Howard County Public School System (HCPSS) by 5.1%. He writes:
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Our FY26 budget includes an increase of $39 million in recurring funding to the Howard County Public School System (HCPSS), which exceeds the State mandated Maintenance of Effort (MOE) funding by approximately $39.3 million. This funding growth accounts for approximately 55% of all new county General Fund revenue growth this fiscal year…
This operating increase of 5.1% in recurring funding to HCPSS brings the total County investment to $800 million. Combined with State, federal, and other funding sources, the total HCPSS budget reaches a historic $1.2 billion in FY26.
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Let’s note that Howard County’s economy has generally performed better than MoCo’s over the past decade, enabling it to be better prepared for bad news from the federal and state levels.
And so our next-door neighbor, the county that most resembles us demographically and economically in the state, has a recommended budget that includes no tax increases, a slight decrease in overall spending and an increase in spending on schools.
If they can do it, why can’t we?