Caroline County Deputy Administrator Daniel Fox and budget staff presented commissioners with department and agency FY2026 capital and operating requests totaling about $79.7 million during a workshop on Feb. 18, 2025. The capital packet totals roughly $11 million, and staff said the county faces a roughly $3.7 million gap on capital needs alone.

The presentation covered each department’s capital asks — servers for IT; a proposed rear parking expansion and ballistic windows for the Circuit Court; a transport van and control/intercom updates for corrections; ambulance and cardiac-monitor requests tied to the county’s BLS fund; bridge-design set‑asides to meet future 20% matching requirements; and school and college capital items, including local Board of Education HVAC planning and a multi‑year funding request from Chesapeake College for the Queen Anne’s Technical Building. "Weare about $3,700,000 short in what's been requested in capital," Daniel Fox said during the presentation.

On the operating side, staff reported projected revenue of about $78.8 million and department requests of roughly $79.68 million, leaving a narrow operating gap even before accounting for uncertain state actions. Fox and Grant Coordinator Stacy Seward told the board the county’s most significant fiscal risks are state‑level changes: the governor’s budget proposal could reduce county income‑tax revenue by an estimated $1.4 million and would cut the teacher retirement supplement in half for FY26 with a planned phase‑out in FY27. Those shifts combined with other proposed state cost transfers would raise mandatory local spending for education and retirement supplements.

Administration proposed implementing a merit pay scale for county employees with a 2.5% cost‑of‑living adjustment and one step on the new scale; staff estimate that translates to typical pay increases of about 3.5%–4.5% depending on current placement. Other operating requests called out in the packet included sheriff and animal‑control vehicle replacements, a corrections request for a new investigations sergeant and higher food/medical contract costs, a request from volunteer fire companies for LOSAP eligibility changes and additional training funds, and nonprofit funding increases for certain social‑service providers.

Staff estimated local revenue gains from utility personal property (notably solar projects) but cautioned these are volatile and tied to development timing. Fox also recommended considering budgeting multi‑year projects — such as Chesapeake College’s request — up front rather than spreading funding over several annual budgets.

Commissioners repeatedly raised the difficulty of finalizing a budget while the state budget and several bills remain unsettled. Staff scheduled a department roundtable next week (HAPS Building) to allow commissioners to question agency representatives directly and said they would update the budget as state decisions become clearer.

What happens next: staff will host a roundtable with departments and agencies, revise estimates as state legislation moves, and bring a proposed operating and capital plan back to the board for hearings and adoption on the statutorily required schedule.