Council President Natali Fani-González Proposes New Approach to the Fiscal Year 2027 Operating Budget Focused on Reducing the Tax Burden on Residents, Cutting Government Spending and Making Strategic Investments in Education and Nonprofit Services
MARYLAND, April 18 - For Immediate Release: Friday, April 17, 2026
From the Office of Council President Natali Fani-González
New proposal focuses on affordability by eliminating the proposed property tax increase, establishing a progressive income tax where 96 percent of residents get a tax break, providing funding increases for schools and salary increases for employees while also increasing funding for critical public services.
Montgomery County Council President Natali Fani-González proposed a new, fiscally-prudent approach to the recommended $8 billion Fiscal Year (FY) 2027 Operating Budget today. The new approach would eliminate the proposed 6.3 cent property tax increase, make income taxes progressive, and slow growth in spending, all while preserving social safety net services.
“Our residents are facing an affordability crisis, and we must act now to deliver for our residents in a sustainable, responsible way,” Council President Fani-González said. “With my proposed budget approach, we can finally deliver a progressive income tax. We can protect the most vulnerable with direct services. We can help keep costs down for residents struggling in this economy. Plus, we can deliver wage increases to our dedicated public employees, support our nonprofits, and increase assistance for working families.”
“We can do all of this, and more, with bold, progressive action now,” Fani-González continued.
The proposed approach would implement a progressive income tax structure, with new County income tax rates ranging from 2.5 percent to 3.3 percent, based on Maryland Adjusted Gross Income (AGI). Under this structure, 96 percent of Montgomery County households would receive a tax break, with those above $300,000 paying slightly more.
Under this proposal, Montgomery County Public Schools (MCPS) would still receive a $90 million increase in local funding over the last fiscal year. This is on top of the $584.4 million in increased County funding allocated to MCPS between fiscal years 2022 and 2026.
The proposal targets strategic savings spread proportionally across County agencies – Montgomery County government, Montgomery County Public Schools (MCPS), Montgomery College, and the Maryland-National Capital Park and Planning Commission (M-NCPPC) – according to their relative budget size.
As part of this effort, the proposal calls for a uniform two percent general wage adjustment (GWA) for compensation for employees across all agencies, with no changes to increments. Under this proposal, every employee will receive salary increases, while helping eliminate an increase to the property tax.
Additionally, the new budget approach would bolster County reserves by $50 million, strengthening the County’s position to maintain its longstanding Triple-A bond rating. The Council will continue its work reviewing budget allocations across each department and agency and will vote to adopt the final budget at the end of May.
The Council President’s full message can be viewed here. Details are outlined in the Council President’s memo.
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Release ID: 26-148Media Contact: Tommy Heyboer 240-777-7867
Categories: Natali Fani-González
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