$101M Revenue Loss: Schools Brace For Possible FY22 Budget Cuts

Rockville MD

22 September, 2020

12:18 PM

Description

ROCKVILLE, MD — The coronavirus pandemic may cost roughly $101 million in lost revenue for Montgomery County Public Schools for fiscal year 2022, according to projections by education officials. The projected revenue loss — which is about a 3.6 percent decrease in the school district's $2.8 billion budget — includes a $38.4 million reduction in state aid, a $27.4 million cut in Kirwan Commission funding, and a $36 million dip in money due to lower enrollment (about 2,400 fewer students enrolled this year vs. last year). At the school board's Fiscal Management Committee meeting on Monday, officials discussed seeking a maintenance of effort waiver, which could result in a $52.6 million reduction. Under Maryland law, municipalities are required to spend at least as much per pupil as it did the previous year to receive additional state aid for education. Assistant Superintendent of Finance Dan Marella said he doesn't know if the county will seek a waiver, but told the school board to be prepared for it. "We have significant shortfalls that we're going to have to deal with in the upcoming three months when we put the budget together for fiscal year 2022," Marella said. During Monday's meeting, Marella also raised concerns about the next fiscal year's projected tax revenue losses, which he said could be worse than what was lost after the 2007 recession. Citing economic projections, Marella said the county may lose $192 million in tax revenue in the next fiscal year. Following the 2007 recession, tax revenue decreased by $188.2 million. "We're going to surpass that fairly significantly over the next 12 months or so — very concerning for all involved here," he told the school board. Public hearings on the proposed budget will be held on Jan. 11 and 19. The school board will send the budget to the Montgomery County Council in February. The budget is scheduled to be approved in June.