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Maryland’s Budget, Your Wallet
Sep 28, 2026
Why Maryland’s fiscal choices matter to your wallet, your workplace and your community.
It can feel like everything costs more lately. Groceries. Electricity. Insurance. Rent. Childcare. A night out. The bill to fix your car.
Then there are the taxes and fees — some you see directly, others buried in the cost of something else. For a lot of Maryland families and businesses, there isn't much appetite — or room — for another bill.
So a debate over Maryland’s state budget may sound distant from everyday life.
It isn’t.
The choices Maryland makes about how much it spends, where the money comes from and how it addresses its longer-term budget challenges can eventually show up in the taxes and fees you pay, the services your community receives, the opportunities available to workers and the cost of doing business here.
And Maryland has some real choices ahead, because the state is facing a significant longer-term problem.
The Department of Legislative Services project a $2.57 billion structural deficit — the gap between ongoing revenues and ongoing spending — in fiscal 2028, growing to $3.44 billion by fiscal 2030 (DLS: Effect of the 2026 Legislative Program on the Financial Condition of the State).
Eventually, Maryland has to close it.
And how we do that could affect what you pay, the services you rely on, the community you live in, and the opportunities available here.
Why Does Maryland Keep Needing More Money?
Think about your own budget: when costs rise, you adjust. You cut something, put off a purchase, use savings or find more money somewhere else.
State budgets aren't household budgets, but the basic challenge is similar: when ongoing costs grow faster than ongoing revenue, something has to change.
The state balances its budget every year, as it is required to do. But when ongoing costs grow faster than ongoing revenue, balancing one year doesn't make the underlying problem disappear.
Budget analysts call that mismatch a structural deficit.
A September Update to the Revenue Picture
At its Sept. 24, 2026 meeting, Maryland’s Board of Revenue Estimates raised the fiscal 2027 revenue forecast by about $320 million, to $27.44 billion. At the same time, the Board projected that ongoing General Fund revenues would decline 0.9% in fiscal 2027 and described the underlying economic outlook as largely unchanged.
That gave Maryland a somewhat stronger near-term revenue picture than previously expected. But it did not change the larger issue: the state still faces a projected mismatch between ongoing spending and ongoing revenue in the years ahead.
The Things We’re Paying for Matter
And here's what makes the challenge harder: much of what Maryland spends money on is important to the people who live here.
At the same time, some of those costs have been growing. Temporary federal pandemic assistance has wound down, while costs for health care and services for Marylanders with developmental disabilities have risen substantially. Maryland has also made significant long-term investments in public education through the Blueprint for Maryland’s Future.
Those pressures don’t all hit the budget in the same way or at the same time. But together, they help explain why the challenge persists. The Department of Legislative Services projects the structural shortfall will grow significantly beginning in fiscal 2028, when the state begins relying on increasing amounts of general fund revenue to support Blueprint costs (DLS: Effect of the 2026 Legislative Program on the Financial Condition of the State; DLS: 2025 Spending Affordability Committee Report; DBM: FY2026 Maryland State Budget Highlights).
| What's changing | One number to know | |
| Temporary federal support | Pandemic-era federal funding provided significant, but temporary, resources to states. That extraordinary support has wound down. | Temporary, not recurring |
| Health & disability services | Costs have risen substantially, including for services for Marylanders with developmental disabilities. | $1.7B in FY 22 → $3.3B in FY 25; DDA community-services spending |
| Blueprint for Maryland’s Future | As dedicated Blueprint resources are drawn down, increasing General Fund support is projected to be needed. | $1.57B in FY28 → $3.43B in FY31 in projected General Fund support[A |
Sources: Maryland Department of Legislative Services, 2026 90 Day Report and 2025 Spending Affordability Committee Report, Maryland Department of Budget and Management; Budget Highlights (FY2026), Maryland Department of Budget and Management.
These are things we value and rely on. The harder question is: How do we sustainably pay for the Maryland we all want?
The Choices Affect All of Us
There are different ways Maryland can make the numbers work — spending less, doing things differently, bringing in more revenue or using temporary resources. Most likely, the answer will involve some combination.
But none of those choices happens in isolation.
Raise taxes and people have less money to make other choices — whether that's a family deciding what it can afford or a business deciding whether it can hire, invest or grow.
Reduce spending and people can feel that, too — through a service they use, a program they depend on or an investment their community needs.
There are tradeoffs whichever direction we go. Families, businesses and communities aren't separate parts of this equation. They depend on one another.
But There’s Another Part of the Equation
It isn't only about what Maryland spends or what it asks people to pay. It also matters what is happening in the economy underneath the budget.
Imagine two Maryland communities.
In one, a local business adds ten employees. A vacant storefront gets a new tenant. A young family buys a home instead of moving away. A manufacturer expands its facility. Workers earn paychecks, businesses make sales and people spend money at restaurants, shops and other businesses nearby.
In the other, the storefront stays empty. The manufacturer expands in another state. The family moves away. Fewer people are working and spending money locally.
That difference matters to all of us.
When more people are working, businesses are growing, companies are investing and families are putting down roots, that activity generates income, sales and investment — and helps produce the revenue Maryland uses to pay for schools, roads, health care, public safety and other priorities.
The reverse matters, too. When families leave, jobs disappear, businesses close or investment happens elsewhere, Maryland's existing bills don't automatically shrink to match.
Maryland's fiscal 2026 results offer a useful reminder that a strong revenue year doesn't necessarily mean the economy underneath it is equally strong.
And to be clear: revenues coming in above expectations was good news. It gave Maryland more resources than forecast.
But how those revenues grew matters when we're thinking about the years ahead. More than 70% of the growth in gross personal income-tax collections came from non-wage income — including capital gains, dividends, interest and business income — rather than taxes withheld from workers' regular paychecks. At the same time, Maryland was experiencing job losses and slower economic growth.
The Board of Revenue Estimates does not expect FY2026's pace to continue. It projects ongoing General Fund revenues will decline 0.9% in fiscal 2027, followed by 3.3% growth in fiscal 2028, and describes expected growth in Maryland's major revenue sources as modest.
That's the difference between a strong year of collections and a stronger economic foundation. Maryland doesn't just need more revenue from the same people and businesses. Over time, it needs more jobs, growing businesses, rising incomes and investment generating economic activity — and revenue — more broadly.
That kind of growth won't eliminate the need to make sustainable choices about spending. But it gives Maryland more capacity to pay for the things we value without the only answer being higher taxes or fees on the people and businesses already here.
That's why Maryland has to work both sides of the equation: making sustainable choices about what we spend while creating the conditions for people and businesses to succeed, invest and grow here.
So What Happens Now?
There are only a few months before Maryland's next legislative session begins. Those months matter.
The FY2028 budget is already beginning to take shape. Maryland will get another update to its revenue outlook in December. Lawmakers return to Annapolis January 13, and by January 20, the Governor must submit a balanced budget proposal.
This is when ideas for addressing Maryland's fiscal challenges — this year's and the longer-term ones — begin to take shape. And it's when the rest of us can be part of the conversation.
As proposals emerge, it's worth looking beyond what they raise or save on paper. Ask:
- Does this address the underlying problem, or just get us through another year?
- What happens next? Beyond the dollars a proposal is expected to raise or save, what ripple effects could it have on people, businesses, communities, and Maryland's economy?
- Who ultimately feels the impact? How might the effects of a proposal extend beyond those it directly targets?
- Are we working both sides of the problem — making sustainable choices about what Maryland spends while creating more opportunity for people and businesses to succeed here?
We aren't all going to agree on every answer.
But we agree on more than our budget debates suggest. Good schools. Safe communities. Reliable infrastructure. Opportunity for our kids. Businesses that thrive. Good jobs. A state people can afford to call home.
We agree on the destination. The harder conversation is how we get there — and how we sustainably pay for it. That's the conversation ahead of us.
Stay Connected
We'll be following Maryland's budget debate from now through the 2027 session — the proposals, the numbers behind them, and what they'd mean for the people and businesses who'd live with the results.
Transparency Note: AI was used to assist with research synthesis and drafting. The analysis, conclusions and final editorial review were completed by the Maryland Chamber of Commerce.
