FY 2027 Preliminary 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 Amended Operating Budget
$462.2
Mandated Changes
(7.5)
Additions Reductions
20.5
(12.1)
FY 2027 Prelim Operating Budget
$463.1
Attachment 1 – identifies the mandated and discretionary additions and reductions. The mandated changes decreased the budget by $7.5 million and are as follows: • Personnel expenses for RC 9507 (IT) decreased by $8.0 million (base salaries & fringe benefits) following the transfer of Object 01 (Personnel) costs to Object 08 (Contractual Services). Future IT personnel costs will be allocated to the MDTA by TSO as part of the IT consolidation. After accounting for this change, all other mandated expenses increased $0.5 million. • Overtime (0104) increases by $0.5 million. • Base salaries (0101 – excludes MSP) increases $0.2 million. This is due to the reduction of 12 positions via the State’s Voluntary Separation Program ($1.2). This reduction is partially offset by employee reclassifications/other costs. • Pension cost (0161) increases by $0.1 million. • Employee and Retiree Health Insurance (0152, 0154) increases by $0.1 million. • Maryland State Police (MSP) personnel costs decline by $0.2 million, primarily due to a reduction in Overtime (0104), Health costs (0152, 0154), State Police Retirement cost (0165), and Turnover (0189), which total $0.3 million. This is partially offset by an increase in various other MSP-related personnel costs. • Other – (other fringe benefits, accrued leave, etc.) decreases $0.2 million. The operating budget includes $20.5 million in additional discretionary spending. The key variances are as follows: • Other Contractual Services (0899) increases $8.3 million, primarily due to the transfer of IT personnel expenses from Object 01($8 million) as part of the IT consolidation.
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