Montgomery County’s budget deficit is expected to grow by an additional $70 million, bringing the county’s estimated operating budget gap to about $520 million, Montgomery budget officials said Tuesday.
Lower-than-expected revenues from county income taxes — caused by a worsening stock market — are mostly to blame, county Director of Finance Jennifer Barrett told the County Council.
And prospects of collecting higher revenues from capital gains taxes, as in previous years, are slim, she said.
“The outlook is so much worse in terms of the length of this recession,” Barrett said.
She added that the “good news” was that the county’s tax revenues from salaries and wages have been steady.
“Our jobs are steady and our income is up slightly,” Barrett said. “That’s the base that is going to carry us into the future.”
County Executive Ike Leggett’s proposed county budget is due in mid-March.
The county may collect as much as $738 million in federal stimulus money over the next 2 1/2 years, county officials said.
But so far, the officials said, details about how much stimulus money the county is likely to get and what restrictions will be placed on that money are scarce.
“We’re ahead of other counties in terms of anything we’re doing in trying to put things together,” said Kathleen Boucher, an assistant chief administrative officer.
“But it’s frustrating not to have the clear money numbers that we all want at this time.”
The county school board said Tuesday it planned to spend $21.4 million in stimulus money on services for low-income students and students with special needs.
Council President Phil Andrews said it was important for the public to understand that the federal stimulus money must be spent carefully so the county doesn’t become dependent on federal money.
“The county’s actions will be necessary to close the lion’s share of the our projected, now $520 million budget gap,” he said. “I wouldn’t want people to go away thinking that the stimulus is a panacea for our difficulties.”
