The entrance to One Montgomery Plaza in Norristown, where many county offices are housed. (Photo courtesy Montgomery County Commissioners)
Montgomery County officials Thursday got a first look at the 2026 proposed budget, with a 4 percent property tax increase on tap to lessen a $25.5 million budget shortfall.
County Chief Financial Officer Dean Dortone addressed county commissioners with a presentation of the county’s finances, which initially revealed projections amounting to $607.2 million in revenue and $632.7 million in expenditures.
Dortone proposed a 4 percent county real estate tax increase. Raising the millage rate from 5.252 mills to 5.462 mills would generate an additional $12 million in revenue, Dortone said, bringing the revenue to $619.2 million. Another $13.5 million would be drawn from the county’s fund balance to close the deficit.
“It has been a challenging budget,” Dortone said.
The suggested tax increase would show an increase of around $36 per year for an average single-family home in Montgomery County with a $556,600 market value and $171,200 in assessed value.
Real estate taxes make up the largest portion of revenue, coming in at 53.8 percent, according to Dortone, followed by federal and state grants at 33.7 percent and departmental earnings at 12.5 percent.
On the expenditure side, health and human services, judicial and county administration were the highest expenses calculated, with 36.5 percent, 18.3 percent and 17.8 percent, respectively.
Paring down costs
Dortone noted an initial $55.9 million deficit when the budget process began back in April, but more than $14 million in operational savings was identified to close the spending gap. Those factors included reducing benefit costs by $2 million, operating costs by $1.2 million, and $1.3 million in “structural efficiencies,” and a $450,000 reduction in legal fees.
Dortone added the county plans to eliminate around 11 full-time vacant positions, which he said totaled around $700,000.
“We want to be able to demonstrate that we made tremendous modifications to the process. We made a lot of reductions,” said Montgomery County Commissioner Tom DiBello.
Dortone attributed personnel as one of several “major cost drivers,” with $19 million as a line item for health care and related benefits.
“We’ve experienced double-digit increases from health care. Most of it’s driven by the cost of health care providing the services, besides utilization,” Dortone said. “So that has been a challenge in the last 18 to 24 months…”
Montgomery County Commissioners’ Vice Chairwoman Jamila Winder underscored the value of the county workforce and the “talent” as the “lifeblood of our organization” as she hinted at a forthcoming 3 percent wage increase for employees.
Additional “cost drivers” included $3.6 million in debt service for the capital improvement plan and $5.3 million in rising goods, services and overall contractual obligations spanning several years with “inflationary cost increases.”
Support for homeless
Other notable county investments included $5.3 million in supportive housing initiatives, funding related priorities and supportive shelter services.
“I believe that everyone that calls Montgomery County home should have a safe place to lay their head at night,” Winder said.
DiBello agreed, acknowledging hotel rooms secured in Pottstown and plans to open supportive short-term housing facilities in Lansdale and Norristown for those experiencing homelessness come “with a cost.”
“We want to care for these individuals,” DiBello said. “They’re out there for different reasons … and as a society we need to do what we can to help these people.”
Deputy Chief Operating Officer Stephanie Tipton cited an 11 percent increase in 911 calls to the Montgomery County Department of Public Safety’s dispatch center and a 10.5 percent increase in emergency medical services incidents.
“Our 911 costs are growing, but the actual funding that we’re getting from the state isn’t,” DiBello said, adding that “as a county we’re forced to … cover the growing expenses.”
Attracting residents
Officials also stressed the importance of making strategic investments in the county to continue attracting prospective residents. There are currently 879,190 residents in Montgomery County, according to Tipton, with an anticipated 942,944 population expected by 2050.
Those investments spanned the gamut, including accessibility, county operations, economic development, election security, housing affordability, open space preservation, public safety, and sustainability, she said.
“It not only reflects our fiscal responsibility, but also our shared values as a county,” Winder said.
Officials also proposed raising the county millage rate for the Montgomery County Community College from 0.39 mills to 0.49 mills, Dortone said, as property owners could expect to pay roughly $17 more.
“This rate has remained unchanged for eight years,” Dortone said in his presentation.
The increase would generate around $6.2 million. Along with a $30 million county contribution to the community college, officials expect to create an environment that offers “stable tuition” rates for students for the next three years.
Capital plan
County commissioners also got a look at the 2026 capital improvement plan, which proposed $255.7 million in 2026. Capital fund bond proceeds covered the majority of funding sources at 74 percent, followed by federal and state grants at 10 percent and 7 percent, respectively.
Top programs for fund usage included the Montgomery County Department of Assets and Infrastructure, which took 38 percent of capital funds on projects such as roads and bridges, park maintenance, as well as renovations of the Norristown-based Trail Junction Center, and the Montgomery County-Norristown Public Library, Dortone said.
The county campus plan, specifically the ongoing Montgomery County Justice Center, he said, took a 22 percent share of the capital budget, and the Montgomery County Planning Commission required 21 percent of 2026 capital improvement plan dollars.
“That was very thorough and really an example of what good government looks like,” said Montgomery County Commissioners Chairman Neil Makhija, of the budget presentation.
Montgomery County commissioners unanimously authorized the budget’s advertisement on Thursday. The budget will be available for review, and public hearings will be held at 10 a.m. and 5:30 p.m. on Thursday, Dec. 4, on the eighth floor of One Montgomery Plaza, 425 Swede St., Norristown. A vote to adopt the budget will take place on Thursday, Dec. 18.
Visit montgomerycountypa.gov/finance for more information.
