Dollars & Decisions — Understanding FY27 Budget Choices + What’s Next

December 8, 2025

This is the fifth installment of Dollars & Decisions — a series charting the path ahead toward the FY 2027 budget.

PGCPS is entering the FY27 budget cycle with a clear, two-fold goal: to protect classroom instruction and maintain the district's stable financial footing. This process is critical as we work to close a significant $150 million budget gap for the upcoming fiscal year.

Why We Have a Budget Gap

Operational costs are rising faster than revenue.
Blueprint funding, which makes up nearly all unrestricted revenue, is projected to rise by about 4.3 percent. But the cost of running a school system is growing by more than 6.5 percent, especially in areas like employee compensation and benefits. 

We must rely less on savings.
The district’s fund balance dropped by more than $150 million at the end of FY25. Until reserves are restored, we cannot use prior-year savings to fill gaps in the operating budget. 

The bottom line: To keep the budget balanced, PGCPS must reduce Central Office and school-based spending by $150 million for FY27. 

How We’re Working to Close the Gap

Every division across the school system has been asked to identify reductions based on each division’s share of discretionary spending and overtime. (Special Education and charter schools were excluded from the calculations because of legal and structural requirements.)

So far, divisions have submitted $76 million in reductions — about 51 percent of the overall target and are working to identify additional reductions.

Where Reductions Could Come From

The district looked for cuts that protect classrooms as much as possible.

Potential reduction being considered include:

General Operating Supports — $15.5M

Reducing vacant positions to reflect lower vacancy rates and tightening discretionary spending in schools and Central Office.

Technology and Communications — $5.4M

Delaying new computer purchases, cutting back on software licenses, and eliminating vacant positions.

Facilities and Operations — $6.7M

Streamlining operations and reducing supply purchases and other day-to-day discretionary costs.

Instructional and Student Supports — $4.7M

Shifting allowable activities to grant funding and further streamlining operations.

Workflow Optimization — $16.0M

Eliminating vacant full-time and temporary positions and reducing the use of overtime and substitutes.

Specialized Academic Pathways — $4.3M

Realigning low-enrollment programs and ensuring offerings reflect the district’s strategic priorities.

Contracted Services — $24.2M

Consolidating contracts and reducing reliance on outside vendors.

Altogether, these categories make up the first $76.8 million in reductions submitted by divisions. 

What Happens Next?

This month is dedicated to community engagement, detailed review, and finalization of the proposed budget reductions.

Continuing Community Conversations: PGCPS will continue hosting "Dollars and Decisions" learning sessions, advisory committee meetings, and other community conversations to ensure families and staff are informed every step of the way. Opportunities for public engagement as well as recaps from prior events can be viewed here.

Stakeholder Review: Meetings are currently underway with labor partners and other key stakeholders to review the potential reductions under consideration. The advisory committee includes Board members, parent advisory committee representatives, charter school leaders, and bargaining unit leaders who represent teachers and staff.

Finalizing the Vetting Process: Our goal is to complete the vetting process and finalize the plan for moving forward before the winter break (based on feedback gathered through December).

Validating Reductions: PGCPS is reviewing all submitted reductions to ensure they are sound, equitable, and aligned with student needs. Once validated, they will be included in the Superintendent's proposed FY27 budget.

Even in this challenging budget year, our core priorities remain unchanged:

• Protect classroom instruction as the core of our mission.
• Provide clear, transparent updates throughout the process.
• Align every dollar with student success and staff stability.
• Build long-term financial sustainability for the district.