Revenue Shortfalls Mean Hiring Freeze, Other Cuts

By Carole Barth

Part One: The Operating Budget

Falling into the Gap
Just how big is the predicted budget gap? Expectations are that we will be $401 million dollars in the hole for the Fiscal Year 2009 Operating Budget. That is roughly 10 percent of the County’s current (FY08) operating budget. The State has its own budget crisis, so help will not be coming from that quarter.

According to the County Executive, “It is not realistic to expect that this fiscal challenge will be resolved through future increased revenue estimates or even revenue enhancements.” County Executive Leggett, therefore, announced a hiring freeze in January: “Given our projected $401 million shortfall for the coming fiscal year, I feel it is prudent to hold off filling vacancies within County government, exempting only public safety and essential personnel. This freeze, combined with the two percent savings plan for this present fiscal year that I’ve forwarded to the Council, will help us save money now so that we can more effectively manage the financial challenges that lie ahead.”

The FY08 Savings Plan would cut over $23.6 million by delaying the implementation of new programs, redeploying fire and rescue staff and equipment, cutting back on police overtime, and reducing the number of police recruits and imposing general two percent cutbacks per agency.

What Would You Do?
Mr. Leggett is also sponsoring six budget forums throughout the County in January to seek input from residents. “These public forums give our residents an opportunity to tell me what’s important to them as I prepare next year’s operating budget for submission to the County Council on March 17,” said Leggett. “In light of the shortfalls that we are facing, input from residents for the FY09 budget is crucial in helping us determine priorities.” Citizens can also make suggestions online. To reach the online form go to www.montgomerycountymd.gov and click on the online form link under the “FY09 Budget” heading.

Future Shock
According to an article in the January issue of the Civic Federation News, however, the $401 million dollar shortfall is only the tip of the fiscal iceberg. The six year gap (FY09-12) would be $4.68 billion. One reason for this is rising personnel costs as multiyear contracts go into effect, providing step increases and wage adjustments for many County employees.

Part Two: The Capital Improvements Program (CIP)

This is County Executive Leggett’s first full six-year Capital Budget. The Executive proposed a $3.2 billion CIP for fiscal years 2009-2014. This is an overall spending increase of 1.1 percent. (The previous two CIPs recommended increases of 24.3 and 26.2 percent, respectively.)

Mr. Leggett’s spending plan increases school construction funding to more than $1.4 billion, the largest commitment ever made in Montgomery County. To provide schools with this level of funding, Leggett is proposing to cut County government spending by nine percent.

In addition to North Four Corners Park (see article), several items in the CIP impact our part of the County. Funds are included to begin planning and design of the replacement or renovation of the Third District Police Station in Silver Spring. Continued funding is provided to complete the Silver Spring Transit Center, for construction of the U.S. Route 29 Sidewalk projects, and for the Silver Spring Library. There is also funding for a live music venue in downtown Silver Spring. ■

Important Budget Dates for County
December: County Executive begins developing a recommended operating budget and performance measures for County programs
January 15 (every other year): County Executive submits his/her proposed capital budget to the County Council
March 17: The Executive’s recommended operating budget is submitted to the County Council
First Week in April: The Executive’s recommended performance measures for County programs are submitted to the County Council
June 1: County Council approves the final budget
July 1: New fiscal year begins