Overview
The FY2026 budget dominated the 2025 Maryland General Assembly session, as lawmakers worked to close a projected $3 billion deficit. The final budget package - HB 350 (Budget Bill) and HB 352 (Budget Reconciliation and Financing Act, or BRFA) - includes both spending cuts and new revenues to balance the budget while maintaining investments in education and public employees.
AFT Maryland and its affiliate unions tracked over 35 bills, testified on more than a dozen, and submitted written testimony in over 45 hearings. We thank all our locals for submitting testimony and coordinating with the state federation to get witnesses to Annapolis.
While not every bill we supported passed, we achieved significant victories: passing key legislation, preserving critical budget funding, and defeating proposals that would have harmed our affiliates and members.
Budget Deficit and Revenue Measures
To address the structural deficit, the legislature approved a combination of $2 billion in spending reductions and $1.6 billion in new revenues. This left Maryland with a $2.1 billion rainy day fund and a general fund balance exceeding $300 million.
Key revenue provisions include:
- New tax brackets for high-income earners:
- A new bracket for people who earn between $500K and $1 million
- Additional rate for income above $1 million
- Phase-out of itemized deductions for incomes over $200,000
- 2% capital gains tax for individuals earning more than $350,000 annually
- 3% sales tax on information technology and data services
- Increased taxes on recreational cannabis and sports wagering
With a 20% increase in the standard deduction and the elimination of itemized deductions, 92% of Marylanders will see either no change or a small reduction in income taxes—average savings between $50 and $65.
AFT Maryland worked closely with the Fair Share Coalition to help pass these progressive revenue measures, ensuring the wealthy begin to pay their fair share.
Education Funding
Despite fiscal constraints, the FY2026 budget preserves critical investments in K-12 education under the Blueprint for Maryland’s Future:
- $9.2 billion for public schools - a 5.3% increase ($461 million) over FY2025
- Continued prioritization of low-income students and schools in areas of concentrated poverty
However, the budget also shifts significant costs to local governments, including 100% of teacher and community college faculty pension costs.
In addition, the legislature drafted budgetary language that will require the state department of education to conduct a statewide study on pay and compensation for education support professionals. The study will compare and contrast compensation for ESPs/PSRPs across the different school districts and look into the feasibility of implementing a minimum wage for those support professionals of $25 per hour. The report will be due on August 1, and could impact legislation for 2026.
Excellence in Maryland Public Schools Act (HB 504/SB 429)
Governor Wes Moore’s major education bill passed after significant amendments. Initially, the bill proposed cuts to Blueprint funding, but through coordinated advocacy by AFT Maryland and the Blueprint Coalition, legislators restored scheduled funding for community schools and collaborative planning time.
Key provisions include:
- Community Schools funding remains intact
- The Consortium on Coordinated Community Supports will receive:
- $70 million in FY2026
- $100 million annually starting in FY2027
- Collaborative Planning Time:
- A three-year implementation pause
- Per-pupil funding of $163 continues through FY2029, increasing to $334 thereafter
State Employees
Some state employees were at risk of job loss due to legislation and budget language. AFT Maryland successfully defeated HB 1156 and removed harmful budget provisions that targeted positions in the Department of Government Services and the Maryland Parole Commission.
Key budget provisions for state employees:
- $560 million for the union-negotiated 1% COLA and step increase
- 12 weeks of Paid Family and Medical Leave (FAMLI), fully paid by the state, for state workers beginning in July 2026 - well ahead of the 2028 implementation and costs to the broader workforce.
The Davis Martinez Public Employee Safety and Health Act (SB 26 / HB 176)
This important new law strengthens workplace safety for public employees. Named for Davis Martinez, a parole officer killed during a home visit in 2024, the law includes:
- A new Public Employees' Safety and Health Unit in the Division of Labor and Industry
- Development of public-sector workplace violence prevention standards
- Mandatory workplace safety programs, including regular inspections and reporting
- Annual safety reports published by the Commissioner of Labor and Industry
- Body-worn camera regulations for correctional officers for counties that adopt the policy
- Civil fines and criminal penalties for non-compliance by public bodies.
911 Specialists – Line-of-Duty Death Benefits (SB 396)
This bill extends state death benefits to 911 specialists who die in the line of duty. It also introduces a Line-of-Duty Death Presumption for Suicide, applicable when:
- The public safety officer had a diagnosed job-related trauma or stress disorder
- The suicide is presumed to have occurred in the line of duty, ensuring death benefits for families
State Public Transit Safety (HB 1144 / SB 858)
This legislation allows individuals who commit assault or cause bodily injury on state public transit to be excluded from using the system, potentially permanently. The bill also creates a workgroup to assess penalties and enforcement mechanisms for violators.
Public Employee Relations Act (PERA) Amendments (SB 231)
This bill modernizes the Public Employee Relations Act with several key changes:
- Removes the public health emergency requirement for virtual onboarding by union reps
- Ensures continued dues deduction rights for employee organizations
- Allows PERB to appoint up to three attorney deputy directors
- Repeals the 10-day minimum in-person voting requirement, giving PERB discretion over voting periods
These updates streamline processes and strengthen labor relations for Maryland's public sector workers.
Conclusion
Despite a challenging fiscal environment, AFT Maryland delivered real results for public employees and educators across the state. Through advocacy, coalition-building, and direct engagement with lawmakers, we helped shape a legislative session that prioritized fairness, public safety, and long-term investments in Maryland’s future.
We thank all our members and affiliates for your continued commitment and engagement.
Article by AFT Maryland staff
2025-04-14