MDTA Finance and Administration Committee Meeting Materials

FY 2026 Final Operating Budget Page Two

ANALYSIS

To better understand the budgetary changes and their associated drivers, the changes have been analyzed by mandated and discretionary expenses.

FY 2026 PrelimBudget

$450.6

Mandated Increases

8.1 5.1

Additions

Reductions

(7.4)

FY 2026 Final Operating Budget

$456.3

NOTE: Numbers may not sum to total due to rounding

Attachment 1 – identifies the mandated and discretionary additions and reductions.

Mandated changes increase the budget by $8.1 million and are as follows:

• Base salaries (0101 – excludes MSP) increase by $4.2 million mostly due to: o Reclassifications (grade/step/classification changes) totaling $2.7 million. o A 1% COLA for civilian and sworn employees totaling $1.5 million.

• Health insurance (0151 & 0152) increases $2.3 million due to updated actual activity.

• Pension (0161) costs increase by $0.8 million.

• Maryland State Police Retirement (0165) costs increase by $0.6 million

• Social Security (0151) costs increase by $0.3 million.

• Law Enforcement Officers’ Pension System (0169) costs increase by $0.1 million.

• All other costs result in a $0.2 million decrease, primarily due to Maryland State Police retired health costs.

The operating budget includes $5.1 million in additional discretionary spending. The key variances are as follows:

• Insurance (1309) increases by $1.5 million due to expected premium increases.

• Management Studies & Consultants (0821) increases $1.0 million primarily due to Environmental, Social, and Governance (ESG) analysis and reporting.

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