A new report from Comptroller Lierman’s office sheds light on dire needs in school construction, saying state funding and a change to the funding formulas could be in order. 

According to a report by Comptroller Lierman’s team, keeping up with school construction and renovation needs statewide is becoming a major challenge. In a 30-page document published last week, the agency covered an analysis of the state of school infrastructure, current school funding strategies, and a market based cost analysis. In analyzing the data, agency officials concluded that the current model in Maryland is not working, and changes could be necessary to preserve school quality statewide.

The report correctly highlights that local governments cover the vast majority of per pupil capital spending, citing that on average between 2018 and 2022, 23% of total school capital spending came from state funds, 74% from local governments, and 3% from federal sources. The report goes on to say that while the state has increased funding for school capital expenses intermittently over time, it is not enough to meet the needs of the local education agencies.

Even though many counties have done their best to keep funds flowing for education and school capital improvements, the billions of dollars in unanticipated Blueprint costs have compounded the challenge, particularly for smaller counties with a limited tax base. As previously covered on Conduit Street, Dorchester is a good example of this. For FY26 they had to raise both property and income taxes on local residents to cover the gaps due to school funding mandates jumping by millions and state cost shifts for things the county has no control over.

For school construction specifically, as the costs continue to creep up, more small counties will struggle to find the additional millions it takes to build a new school without disproportionately overburdening middle and lower income residents. The report used Kent County as a current example to illustrate the issues that are unique to small, rural jurisdictions.

Kent County receives the minimum 50% cost share percentage from the IAC, in large part because enrollment has declined consistently since 2000. However, on average across its five schools, Kent County school buildings rank worst in the state based on FCI scores, meaning their buildings have the
least remaining useful life. Kent County will have difficulty funding its share of the estimated $68
million project to replace its Middle School, while also supporting other needs, without a larger state
cost share. (They have a small tax base – their total population is 19,000, the smallest in the state –
and their total capital budget averaged $2.7 million annually between FY12-20.

Examples of ways to resolve the funding shortage were given from other states that have dedicated revenue set aside for school construction, such as a portion of the state sales tax in Massachusetts. Reimagining the statewide funding formulas and revenue streams was highlighted as also playing a significant role in closing the widening gap.