Howard County’s anticipated budget deficit — though only a fraction the size of the state’s — is requiring officials to leave positions vacant and make spending cuts.
A $1.8 million deficit is now being projected for Howard because of a shortfall in revenue, said Budget Director Ray Wacks. The county has a $850 million budget for fiscal 2009.
“With current revenue projections [tied to property-related taxes and fees], we’re close to breaking even,” said Wacks on Wednesday.
“But we’re not satisfied with that.”
The news comes as the state Board of Public Works approved more than $345 million in budget reductions Wednesday to balance the state budget as it prepares for additional expected shortfalls in 2010, which could affect Howard.
Howard takes action
To address the county’s deficit, Howard officials will hold open 24 vacant positions, including inspectors, a move expected to save about $1.2 million.
Public safety positions will not be affected, Wacks said.
The reduction in take-home vehicles, announced this past summer, is expected to save an additional $500,000 this year.
Cuts in discretionary spending, including furniture purchases for offices, also are being encouraged in all county departments and offices, Wacks added.
Revenue outlook optimistic
In terms of revenue, Wacks said Howard was expecting to receive a surplus in property tax revenue to offset a decline in recordation taxes, development-based revenue such as building permits, and income tax.
Precise figures for revenue are expected to be available late November or early December, said Councilman Calvin Ball.
Council apprehensive
Some council members said the budget needs to be carefully examined.
“[The budget outlook] has looked so bad, we’ve asked [Ray Wacks] to come to every meeting we have from now on,” said Councilwoman Mary Kay Sigaty.
Ball said he was worried about the deficit, especially with this past year’s projected surplus of more than $10 million, most of which went toward retirement spending and one-time building expenses.
“We can be somewhat insulated here in Howard County, but there are issues we must look at,” he said.
“These are challenging times, and we’re going to have to make some tough decisions.”
Burden of pensions on school system
School system officials and school board members are concerned about the costs of the retirement and pension system eventually being placed on local counties, most of which is now paid by the state.
“This has been the bullet to get the [Maryland State Department of Education] to support slots,” said Board Vice Chairwoman Ellen Flynn Giles.
A ballot question will ask voters to support up to 15,000 slot machines, where its partial revenue will supposedly benefit education.
The estimated retirement payments in fiscal 2010 for eligible school system employees, including teachers and administrative staff, will be $45.2 million, said Ray Brown, the school system’s chief operating officer.
Currently, the school system only contributes to retirement for non-eligible employees, such as food-service workers and custodial staff, which is typically less than $4 million a year.
“There’s no way we can absorb that $45 million, so options are being discussed, like us only paying a fraction of this,” Giles said.
The county government and school system in September formed the Cooperation and Efficiency in Government Work Group to explore cost-saving measures within the school system.
Saving money
Selected cost-saving measures from the Howard County Public School System:
Area Annual savings
• Installing high-efficiency lighting $182,000 to $396,000
and updating heating, ventilation and air
conditioning control systems at 13 schools
• Recycling and repurposing computers $150,000
• Updating stadium field irrigation technology $10,000
Source: HCPSS
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