HAGERSTOWN – The Hagerstown City Council approved a $222.9 million operating budget for fiscal year 2025–26 during its regular session on May 27. Alongside the budget, council members voted to maintain existing real and business property tax rates for the sixth consecutive year.
While the City of Hagerstown has kept its property tax rate steady at $1.057 per $100 of assessed value for Fiscal Year 2026, many homeowners may still see higher bills due to increased property assessments.
According to the Maryland Department of Assessments and Taxation, residential property values in Washington County increased by an average of 34.3 percent, the highest among Maryland’s counties this year. For a home previously assessed at $250,000, that increase would raise the taxable value to $335,750. At the city’s current rate, the annual tax bill would rise from $2,642.50 to $3,551.23, an increase of approximately $908.73.
Maryland’s Homestead Tax Credit helps lessen the impact on primary residences by limiting the taxable assessment increase. The credit is capped at 10 percent statewide, with the potential for lower limits locally. Homeowners must apply for the credit to qualify.
The adopted financial plan will fund city services and capital projects from July 1 through June 30, 2026, without increasing the city’s tax rates. Officials cited steady economic growth, increased property values and responsible budgeting as key factors in maintaining current rates while expanding investments in critical areas.
Tax rates for business personal property remains at $2.643 per $100 of assessed value.
Both rates are unchanged from the current fiscal year. Council members emphasized that this approach balances fiscal responsibility to minimize the financial impact on residents and businesses.
Highlights from the FY 2026 budget
The $222,997,300 budget reflects the city’s commitment to public safety, infrastructure investment and quality of life improvements. Major funding areas include:
- Continued operation of the ice rink, golf course, swimming pool and train museum
- Full staffing for public safety departments, including police and fire services
- Capital improvement projects across transportation, parks, and facilities
- Continued funding for eight community partner agencies
- No increases to parking fees or cuts to contingency reserves
- Reduction in funding for the Invest Hagerstown incentive program to reprioritize budget allocations
The budget also preserves healthcare benefits and staffing levels for city employees.
Next steps
With the budget and tax rates in place, city departments will proceed with planned projects and service initiatives. City officials encourage residents to remain engaged and informed as the fiscal year progresses. The next mayor and Council work session will be held on Tuesday, June 3, at 4 p.m. Members of the public are invited to attend or submit comments.
