With an interim Blueprint evaluation due in December, state lawmakers will grapple with a $1.8B education funding shortfall during the 2027 legislative session. This policy deep dive will analyze where funding pressure exists at the state and local level, as well as what steps state leaders might consider to close the gap. 

Governor Moore and the General Assembly are heading into a 2027 legislative session this January, facing a general fund shortfall of almost $3B. $1.8B of that shortfall is specifically required to fund education under the statutory requirements of the Blueprint for Maryland’s Future (Blueprint). That gap grows to $2.2B, $2.9B, and $3.3B through FY31.

Closing a $1.8B gap in a nearly $3B shortfall is a feat and will require more than the tweaks the General Assembly has employed over the last couple of years when funding and revenue issues arose, particularly if they also intend to address the out years. These coming tweaks – for the first time since the Blueprint rollout began – will be informed by an evaluation of how the first five years have gone. This two-part deep dive will analyze how state and local funding has evolved since Blueprint implementation began and consider what options lawmakers have to sustain and fund the remaining seven years of Blueprint implementation.

What is the $1.8B gap made of?

That $1.8B gap is made up of everything from teacher salaries, to aid for students living in poverty, support for students with disabilities, more resources for multi-lingual learners, and the like. Politically, all of these categories would be very difficult to cut. That challenge is not unlike those just experienced by lawmakers in balancing the FY27 budget last year, when they were enacting funding cuts for the Developmental Disabilities Administration.

Below is a snapshot, from the Maryland Department of Budget and Management, showing the FY28 funding required in just a few primary Blueprint categories:

• Foundation Program  – $474M
• Compensatory Education – $470M
• Special Education – $496M
• English Learners – $218M
• Prekindergarten – $284M
• Concentration of Poverty School Grant – $696M
• Teacher Salaries – $36M
• College and Career Readiness – $37M

As Dr. Jeffrey A. Lawson, Superintendent of Schools in Cecil County, shared during the 2026 MACo Summer Conference, these are categories that require state lawmakers to have some very tough conversations. Not only are these difficult categories to deny new resources, more than half of the $1.8B shortfall is funding that was already provided because it came from a state savings account – now depleted – that was earmarked for education funding. In essence the shortfall is not just the year over year increase, which is only about $500M of the total gap. If the full gap is not covered, it would include the pulling back of billions of dollars the school systems had already been using and relying on as they continue the mandated expansion of the Blueprint.

How have the original Blueprint funding formulas fared?

There is a somewhat obvious and growing consensus among stakeholders within education that the formulas that calculate the Blueprint funding requirements have not accurately represented the actual costs. Those formulas were intended to calculate what the cost would be to educate a student based on various categories of need over ten years of implementation. Those formulas, that were developed in 2019, accounted for the per-pupil cost based on need and inflation under anticipated circumstances. Understandably, nothing about the financial aftermath of COVID-19 was anticipated. Neither was the stagnant revenue growth the state has seen in the years to follow.

This has put school systems into a position where they are required to provide services that cost exponentially more than the formulas account for, and that is even while counties are providing billions more than they were told to expect (more on that below). Dr. Carey Wright, Maryland State Superintendent of Schools, during the 2026 MACo Conference cited that services for special education, multi-lingual learners, and students living in poverty are some of the areas where post-COVID cost pressures have hit the hardest. Additionally, the Public School Superintendents Association of Maryland provided recent numbers detailing that, statewide, school systems are covering a billion-dollar gap in special education funding out of rainy-day funds, and reserves, with those accounts gradually dwindling down. Despite this reality, state funding for the Blueprint has primarily been contributed at the statutory minimum level devised in 2019.

How has county funding fared?

Under these circumstances, counties across Maryland have been stepping in to help the school systems by providing more money in most circumstances than the programs were estimated to cost originally because counties understand the cost pressures that have materialized for schools and all other county services. For scale, counties statewide, as of FY27, are providing almost $2.2B more than what the state had estimated the local cost would be. This means annually that most jurisdictions are continually increasing their contributions, with discretionary funding, to help fill the gaps rather than – like the state – simply paying the statutory amounts that were estimated and required.

For county governments this has meant raising taxes in an election year, pulling funds from other vital services, establishing new local fees, and ultimately making the hard decisions that leaders at the state have yet to do. In no small part Blueprint progress to date is largely due to counties stepping in, with additional funds, where school systems have made clear the gaps exist. In FY27 nineteen jurisdictions provided more than the statutory requirement, which is counter to the original assumption that most jurisdictions would eventually simply fund the state estimate.

What’s next?

The above recap gives a general sense of the financial position of the state, the counties, and the school systems where implementation of the Blueprint is concerned. The state is currently preparing to address a $1.8B gap in their required education funding during the 2027 legislative session. This challenge comes on the heels of the first substantial five-year review of how Blueprint implementation is going. There are dozens of tools lawmakers could use to balance this portion of the state budget while considering the components of the plan that are going well as well as those that present more challenges.

Part two of this article will explore what some of those strategies could be.

This article is part of MACo’s Policy Deep Dive series, where expert policy analysts explore and explain the top policy issues of the day.