Operating Budget
The HCPSS operating budget covers the cost of day-to-day school operations, with a focus on educating students and supporting teachers. The operating budget prioritizes the greatest needs of students, staff, families, and the school system while progressing toward the mandates of the Blueprint for Maryland’s Future.
FY 2025 Operating Budget: Details on the FY26 Operating Budget and process, including the final approved budget, can be found online.
Jump to: How the Budget is Spent | How the Budget is Funded | How Education is Funded in Maryland | How the Budget is Monitored and Managed
How the Budget Is Spent
The majority of the operating budget, 83.3 percent or $1,014 million, invests in our educators, paying the salary and benefits for nearly 9,000 school system employees, the majority of which work in schools each day.
The remaining 16.7 percent or $202.76 million of the operating budget is spent on non-compensation related costs. The major expenditures in these areas are:
- Transportation service providers, excluding administrative costs ($62.03 million)
- Utilities ($22.42 million)
- Instructional supplies and materials for schools ($9.49 million)
- Other instructional costs for schools ($11.45 million)
- Non-public placements: tuition and transportation costs for over 300 special education students attending non-HCPSS schools ($26.37 million for tuition and $9.13 million for transportation)
- Technology services and computers ($20.55 million)
- Maintenance costs for buildings, supplies, and equipment ($9.91 million)
Per-Pupil Spending
The cost per pupil reflects the average cost of providing educational and related services to students in the Howard County Public School System. This spending covers instruction (including salaries and materials), special education, maintenance, pupil personnel (counselors, health supports, social workers), transportation, and food services.
$120.22/Day
$21,640/Year
How the HCPSS Budget Is Funded
County Funding
County funding is the largest source of revenue for HCPSS. FY 2026 funding of $816.03 million represents a Maintenance of Effort (MOE) level of funding of $760.22 million as provided for in State Law, plus $55.28 million to meet system commitments, mandates, and priorities Of this $55.28 million, $1.51 million has been identified for one-time funding as approved by the Maryland State Department of Education (MSDE).
State Funding
State funding is the second largest revenue source for the budget. FY 2026 state aid from MSDE shows that state revenues increased by $24.38 million, 6.9 percent above the prior year. Maryland State Aid formulas distribute unrestricted funds based on enrollment, relative wealth of each county, level of local expenditures for education, and other factors. Consistent with the State Budget and statutory adjustments to enrollment calculations, the budget is based on the funding formulas enacted in the Blueprint for Maryland’s Future (House Bills 1300 and 1372), which increased per pupil funding amounts and modified the calculation of enrollment in state formula aid and county maintenance of effort revenues.
Other Funding
Other revenue sources include building use fees, gate receipts for athletic events, fees for out-of-county students assigned to HCPSS, interest income, summer school tuition, and e-rate rebates. Other revenues are reduced by $314,830. In addition, the use of fund balance from the General Fund has been reduced to $2.14 million, representing a decrease of $12.96 million from the FY 2025 budget. Lastly, a one-time transfer of $7.00 million of unrestricted fund balance from the Technology Services Fund and a one-time transfer of $3.00 million from the Health Fund is included.
Understanding How Education is Funded in Maryland
In Maryland, public education is funded through the State School Fund based on major aid programs. For each major aid program there is a required state share and required local share, which establish the minimum amount of school funding. The amount of state and county funding for each major aid program is funded based on specific per pupil funding formulas multiplied by applicable student enrollment.
Unless otherwise defined in law, student enrollment is measured two ways: the first measurement is the actual enrollment as of September 30 of the current school year, and the second measurement is the 3-year average enrollment. The greater of the two measurements is multiplied by the prescribed funding amount per pupil. The result establishes the required minimum level of funding by the state and the county. The required level of funding per pupil must be maintained year-over-year. In other words, the amount of funding per student cannot decline year-over-year in Maryland. This is referred to as Maintenance of Effort (MOE) funding.
The minimum level of funding for each of the major aid programs is split between the state and the local government based on relative wealth and other factors. The Maryland State Department of Education (MSDE) calculates the required state share and required local share. The required state share becomes the revenues received from the state. The required local share is what the county must fund. However, a county can fund more than its required local share.
When a county funds an amount greater than the local share, this increased amount of funding becomes the base that must be maintained each year. This is referred to as the required Maintenance of Effort that the county must fund. In addition to the required MOE, the school system can request the county to fund an amount above MOE. The required MOE and the above MOE amounts make up the recurring funding that the county provides. One year’s recurring funding becomes the basis for calculating the next year’s MOE.
In addition, the school system can request non-recurring funding for qualifying one-time expenses. Non-recurring funding does not affect the subsequent year’s MOE. Consistent with the high value placed on public education in Howard County, the county funding provided each year exceeds the required local share.
How the Budget is Monitored and Managed
Once the budget is adopted and the fiscal year begins each July 1, HCPSS monitors and manages the budget providing Operating Budget Financial Reports to Board on a monthly basis. These reports provide detailed information on budget, including revenues and expenditures and actions taken to manage spending with the approved budget.