After imposing a hiring freeze Tuesday, County Executive Robert R. Neall dropped the other fiscal shoe Thursday when he ordered department heads to come up with no-growth budgets for next year.
The order could put an 18-month hold on any plans for expanded services.
County officials warn that the recession and a state government deficit have undermined Anne Arundel's financial health.
"We're looking at essentially flat revenues, which generates the mandate for a flat budget," David Almy, Neall's deputy chief of staff, said Friday.
Neall gave department heads their "marching orders" Thursday during his first budget meeting as county executive, Almy said.
The command to run in place is consistent with the hiring freeze and other spending constraints under the $617 million budget Neall imposed last week.
Budget officials predict that the county will carry over a $17 million surplus when fiscal 1992 begins July 1. But Neall said he wants to expand that buffer to prevent Anne Arundel from slipping into the deficit facing Baltimore City and the state's other large jurisdictions.
The recession will cost the county about $10 million in revenues lost to lower construction activity and a slowdown in income tax collections, budget officials predict. Another $3 million in aid will be cut as the county's share of fallout from the state's $418-million revenue shortfall.
"We are going to play it accordingly and play a very conservative game as far as staffing is concerned," Almy said.
Neall's order for a flat budget comes while the county and its 11 public employee unions begin preliminary posturing over contracts that expire when the fiscal year ends.
Even without a cost-of-living raise, mandated merit increases will add about $14 million to the public payroll next year.
That creates the possibility that public employees will not get a contract raise next year, as Neall tries to boost the budget surplus while keeping his campaign promise to cap growth in property tax revenues at 5 percent.
That scenario could replay the bitter fight that Democrat O. James Lighthizer waged when he froze a contracted raise to make up for the budget deficit he inherited in 1982.
"Neall's too new and it's too early to make assumptions that we can get a raise or not get a raise," said James Bestpitch, vice president of the 900-member American Federation of State County and Municipal Employees Local 582, which represents blue-collar utilities and public works employees.
Teachers union President Thomas Paolino said a "flat" budget does not necessarily concern him if Neall takes into account the growing costs of education.
"But if he says the exact same dollar amount as we have this year, that worries me, unless he can stop inflation and growth in the number of students," said the head of the 4,000-member Teachers Association of Anne Arundel County.
Meanwhile, the hiring freeze and spending controls Neall imposed last week have caused only a slight chill in government offices.
The order puts personnel plans on hold for all county agencies unless personally approved by the new executive, who started his job two weeks ago.
There were just 180 vacancies reported Friday, out of a 3,500-person work force, so county officials expect to make it through the fiscal year without cutting services.
With only 19 vacancies out of about 500 positions, Department of Health spokeswoman Evelyn Stein said, "We're not talking at this point about a real impact on our services."
But the agency, which receives only part of its budget from the county, already has abandoned a drive to move some of its jobs from state to local funding, she said. Department head Thomas Andrews was seeking the change to allow the county to pay more for various health inspection jobs than the state allows.
The county has a history of losing employees to other localities. "We train them, and they hire them because they can pay more," Stein said.
But with a hiring freeze at both the state and county levels, changing the policy "is no longer an alternative," she said.
"As far as the county is concerned, we have lost no one," Don Hillman, who heads Project Independence for the Department of Social Services, said Friday.
The education, training and counseling program is part of a state and county effort to move people off welfare rolls into taxpaying jobs.
Hillman said the program is under no threat this year because it has a fixed contract to serve no more than 600 people.
"Of course, we're nervous (about next year)," he said. "With the recession, we'll probably get a lot more referrals. If it gets ridiculous, we're not going to be able to serve thousands of people coming through."
As for public safety, Fire Administrator Joseph "Mac" Connell said last week that his department is close enough to its budgeted staff level that the freeze will have no effect this year.