Hundreds of millions of dollars in surplus funds may sound like a lot of money, but officials in the Baltimore area say the numbers can be deceiving.
With retiree-benefit liabilities and looming state cuts, much of the money is already spoken for, officials said.
“It sounds like a lot of money,” said Howard?s Finance Director Sharon Greisz, referring to the county?s $22.7 million surplus for fiscal year 2007.
But at about 3 percent of the county?s operating budget, the surplus is “a reasonable cushion.”
The surplus was lower than last year?s, due in part to a dip in recordation taxes from a slowing real estate market. Officials have set aside $15 million of that to cover the liability from a new requirement that officials to show they can cover current and future retiree benefits.
The rest must be used for one-time expenses, such as paving a road or school construction, Greisz said.
In Carroll, about half of the surplus is set aside for capital expenses. This year, the surplus was $7.3 million, which is 2.4 percent of the budget, said Budget Director Ted Zaleski.
Each year, Carroll budget officials assume about 1 percent of the budget is available for the next year, so the rest becomes part of the general revenues for fiscal 2009, Zaleski said.
In Baltimore City, half of the $40 million surplus in 2007 went to cover employee overtime costs, officials have said.
Anne Arundel County hasn?t reported its numbers yet but they usually use the surplus for one-time capital expenditures, Budget Director John Hammond said.
About $60 million of Baltimore County?s $212 million surplus is undesignated, with the rest going to capital projects and a rainy day fund, spokesman Don Mohler said.
“It?s sitting there,” Mohler said, adding this will likely make it easier for the county to handle any state cuts handed down, such as the freeze in Thorton education funding.
“So if and when we get to lean times, we would not have to make draconian cuts,” Mohler said.
Many county officials are bracing for tougher budget times.
In Harford, officials have said about $23 million of the $100 million surplus is undesignated, and provides a cushion for impending state cuts.
Howard?s County Executive Ken Ulman said he was “reasonably pleased,” with the surplus. “We have some state budget cuts and slowing revenues and tough challenges ahead.”
