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Bill

HB 562

Primary and Secondary Education - Maintenance of Effort - Inflation Adjustment (Maintenance of Effort Modernization Act)

2026 Regular Session Introduced by Gabriel Acevero and 11 co-sponsors

Bill allows Maryland school districts to adjust maintenance-of-effort funding baseline by inflation rather than maintain flat nominal spending, potentially reducing required education spending growth.

Hearing 2/24 at 1:00 p.m.
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Bill Summary · HB 562

Legislative bill overview

HB 562 modernizes Maryland's "maintenance of effort" (MOE) requirements by adjusting how school districts must maintain education funding levels relative to inflation. Rather than keeping funding flat in nominal dollars, the bill would allow districts to maintain funding adjusted for inflation, effectively lowering the baseline they must meet each year. This targets the technical formula used to ensure minimum education spending.

Why is this important

Maintenance of effort requirements prevent districts from gutting education budgets during tight fiscal years. However, without inflation adjustments, these requirements can consume growing portions of district budgets in real terms, potentially constraining flexibility for other priorities. This bill directly affects how much funding schools must guarantee and influences state-local budget negotiations worth billions annually.

Potential points of contention

  • Fiscal impact on schools: Adjusting MOE downward by inflation could reduce actual education spending growth, particularly harming districts serving disadvantaged students who rely heavily on state funding increases
  • State vs. local responsibility: The bill shifts risk of inflation onto local taxpayers; if districts don't increase spending beyond the inflation-adjusted baseline, real per-pupil funding declines
  • Implementation complexity: Determining appropriate inflation measures and calculating adjustments across diverse district sizes and cost structures presents administrative challenges

Compiled from official sources — confirm details with the bill’s official record.

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