Arlington County faces a gap of nearly $20 million for fiscal year 2008 if the county maintains its current level of services, according to a county manager’s report expected to be delivered to the County Board on Wednesday.
“A budget that maintains all current services at current levels should not be assumed,” the county manager’s report says.
The anticipated shortfall could get larger, as the $19.6 million does not include certain health care costs. It comes as county voters just approved five bond packages totaling $207 million.
This means that Arlington will have to change the way it spends money, reallocating resources within the county to adjust to a decrease in revenue, or raise taxes to generate more revenue, if it is to maintain the current fiscal year’s service level. While revenue in fiscal 2008 is expected to increase by 3.2 percent, it was up more than 9 percent in fiscal 2007, the current budget year.
“Our revenues are going to be darn healthy, but not as healthy as they were in the last four or five years,” said Mark Schwartz, director of Arlington’s management and finance department. “We need to save money.”
Schwartz said the fiscal 2008 budget would be hashed out over the next three months. He said the county manager would not submit a budget that raises taxes.
“The manager is going to have to submit a budget within current tax rates that’s balanced,” he said.The process “won’t be without pain, or without difficulty.”
Mike McMenamin, member of the Arlington Fiscal Affairs Advisory Committee, which advises the county board on budget matters, said the shortfall should not come as a surprise.
“We knew back in June that, indeed, the 2008 budget could have some shortfalls because of the fact that [real estate tax] assessment shortfalls were coming,” he said, referring to a drop in real estate tax revenue because of the slowdown in the housing market.
“The county told [the advisory committee] there were going to be cuts, and this time they’re serious about it,” he added. “We don’t know where those cuts are going to come from yet. We’re going to have to wait and hear back from the county in the coming months.”
