After multiple work sessions earlier this year, the St. Mary’s County Commissioners have approved a $682.7 million recommended budget for fiscal year 2027, advancing the proposal to a public hearing scheduled for April 21 at 6:30 p.m. at Chopticon High School. Comments can also be emailed to csmc@stmaryscountymd.gov.

This article provides an in depth look at decisions that shaped the budget proposal. However, let’s start with a quick summary for what you need to know before the public hearing.

No property or income tax rate increases, although revenues will increase due to projected growth in both categories.
Of a total $69 million in unassigned fund balance, $18.9 million is available for use per county policy. Commissioners used $16.9 million to balance the budget and fund major purchases.
County, public safety, and library employees will receive cost of living adjustments, step increases, and market rate adjustments to their pay.
13 new positions added, mostly in Emergency Services.
SMCPS receives $8.4 million in additional funding, but this does not cover the 13 at risk social worker positions.
Fees increasing for recreation and parks and the solid waste program, while Bay District Fire Department is requesting an increase to their fire tax.
This budget relies on optimistic revenue and reserve spending, which may create future shortfalls if the economy weakens.

Full Analysis:

The proposed budget represents an overall increase from the current fiscal year, with $377 million coming from local revenues and fund balance — an 8.2% increase in the locally funded portion — and approximately $305.7 million supported by state, federal and other sources.

The county’s property tax rate will remain at $0.8478 per $100 of assessed value. However, rising property assessments are expected to generate $146.2 million in property tax revenue, an increase of $8.3 million, or 6%, over the current year.

The Commissioners did not adopt the constant yield tax rate of $0.8245, which would have kept property tax revenue flat. By maintaining the higher rate, the county is projected to generate an additional $3.76 million.

During budget deliberations, Commissioners increased the projected property tax revenue growth from an initial estimate of 4.6% to 6%. Commissioner Mike Hewitt cited the county’s $17 billion assessable tax base and expressed confidence in continued revenue growth. Commissioners Ostrow and Guy agreed.

The local income tax rate will remain at 3.2%. Initial projections estimated a 7.4% increase in income tax revenue, or $11.3 million. However, Commissioners ultimately adopted a higher growth assumption of 8.9%, raising the projected increase to $13.75 million.

Chief Financial Officer Vanetta Van Cleave previously cautioned that revenue growth could be impacted by changes to State and Local Tax (SALT) deductions under the One Big Beautiful Bill passed in 2025. She noted the potential for reduced local revenue, estimated at up to $7.8 million.

Current projections also do not fully account for the economic effects of federal workforce reductions in 2025. The county continues to receive tax distributions based on prior tax years, meaning projected revenue growth relies largely on data from 2024 and earlier.

In addition to tax revenues, the proposed budget includes fee increases for recreation programs and solid waste services, as well as a requested fire tax rate increase for the Bay District Volunteer Fire Department.

General fund expenditures are largely driven by employee compensation and public safety investments. County employees are slated to receive a 2% cost-of-living adjustment, step increases and a 3.66% market-based salary adjustment, the final of a three-year phased in approach. Similar increases apply to Sheriff’s Office personnel and library employees.

The budget adds 13 positions across county government, including eight in emergency services, two in the State’s Attorney’s Office and one each in finance, human resources and information technology.

The Commissioners funded the Board of Education’s request for an additional $8.4 million, bringing total county funding for the school system to $147.45 million. The funding supports negotiated salary increases, including step adjustments and a 2% cost-of-living increase for education employees.

While both the Board of Education and Commissioners expressed satisfaction with the funding level, the budget does not address the potential loss of school social worker positions tied to expiring state and federal grants. Maintaining current staffing levels could require an estimated $1 million in additional funding or reductions elsewhere.

At the April 14th joint meeting between the County Commissioners and the Board of Education, Commissioner Colvin asked about the social worker positions. Tammy McCourt, Deputy Superintendent of Fiscal Services for the school system, said that eight social worker positions will continue. Four positions will be at schools with a higher concentration of students in poverty, classified as social emotional learning / social workers. Others will continue to be funded through remaining STOP Grant Funds. McCourt said there was not enough funding to retain four social workers, but those individuals have been encouraged to look for other opportunities within the school system or broader community.

St. Mary’s County Public Schools has reduced staff by over 80 positions across the last several years, McCourt noted.

As of June 2025, the county reported a total fund balance of $88.7 million, including $69 million in unassigned general fund balance — approximately 20.66% of annual revenues. County policy calls for maintaining reserves at 15%, or roughly $50 million.

*screenshot from March 24 Budget Work Session*

The recommended budget proposes using $16.9 million in fund balance.

Of that, $11.2 million is allocated within the general fund for major purchases, including:

$2.7 million for 25 new Sheriff’s Office vehicles
$4.39 million for emergency services equipment, including radios and an ambulance
$1.6 million for public works vehicles
$373,000 for recreation and parks equipment
$1.08 million grant to the Hollywood Volunteer Rescue Squad for building repairs

An additional $3.56 million is allocated to support enterprise and special revenue funds, including solid waste and emergency services programs. The budget also includes $1 million reserved for snow removal and just over $1 million for nonprofit grants.

Despite these allocations, approximately $2 million in fund balance remains unassigned. (This information is not explicitly stated in the recommended budget, however was included in a presentation to the Commissioners on March 24). The Commissioners have also set aside $78,000 for potential adjustments following the public hearing.

At the request of the Emergency Services Board, Commissioners voted to increase the Fire and Rescue Revolving Loan Fund from $5 million to $8 million and to allow higher borrowing limits for individual departments.

The fund provides low-interest loans for equipment purchases and facility improvements. The Hollywood Volunteer Rescue Squad is expected to receive a $2 million loan for building repairs, in addition to a $1 million grant approved by the Commissioners. Commissioner Eric Colvin noted the grant falls outside the board’s typical funding practices.

*from recommended budget: General Fund - Pay-Go line includes grant to Hollywood VRS*

By structuring the support as a combination of loan and grant—Commissioner Hewitt’s idea—the Commissioners avoided the need for immediate additional funding in the revolving loan fund, which is projected to face financial strain in two years.

*screenshot from March 17 Budget Work Session*

The combination of increased reliance on fund balance, higher revenue growth assumptions and ongoing personnel cost increases may present challenges in future budgets, particularly if economic conditions shift.

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