Though Harford County is in the middle of a hiring freeze, two jobs are open: a financial adviser and bond counsel. The expertise of those specialists will be needed before the county goes to the bond market sometime in October or November to borrow more than $6 million to finance four building projects.
The decision to borrow from Wall Street represents a change in Harford County's recent fiscal practices.
Pay-as-you-go financing was the hallmark of Habern W. Freeman Jr.'s eight years as county executive. He had good reasons to follow this conservative approach. The county was in bad financial shape when he came into office; increasing its long-term debt would have been unwise. Also, the boom years of the 1980s produced phenomenal growth which enabled the county to finance infrastructure and service expansion from steadily increasing revenues as long as overall spending was controlled.
By the time Eileen M. Rehrmann succeeded Mr. Freeman as county executive late last year, the situation had changed. Harford was sliding into recession. Instead of surpluses, the county was struggling just to stay in the black.
During her campaign for county executive, Ms. Rehrmann had been talking about re-entering the bond market as a means of giving her flexibility in fiscal management. As the economy has continued to worsen, her administration has become even more convinced that increasing Harford's long-term debt is necessary for two reasons.
First, more than $6 million is needed to finance the new Fallston Middle School, the Belcamp-area elementary school, the Route 543 elementary school and improvements to the Bel Air Library.
Second, a cash cushion is needed to protect Harford's solid bond rating -- AA from Moody's, A-plus from Standard and Poor's -- to enable the county to take advantage of low interest rates in borrowing for such purposes as water and sewer expansion. Borrowing for capital costs would enable the county to maintain a cash reserve.
Harford countians will have an opportunity to comment on the bond proposal at 6:30 this evening in the council chambers in the Bel Air courthouse. Borrowing from the bond market is a routine fiscal option which countless counties, municipalities and states utilize every year. As long as the county's day-to-day finances are soundly managed, Harford residents have little to fear.