Baltimore County's tax revenues are expected to be $27 million below what the county estimated this year, Executive Roger B. Hayden said yesterday.
That's nearly twice as large a drop as budget officials had predicted just a few weeks ago, and Mr. Hayden says it will create a deficit of $14 million to $23 million -- unless there are
more county budget cuts.
The size of the deficit will depend on which budget plan the General Assembly adopts.
The deficit would be $14 million under the plan proposed by House Speaker R. Clayton Mitchell Jr. The Mitchell plan, which has the support of the governor and the Maryland Association of Counties, would cut $88.5 million more from state aid to local governments, instead of the $142.5 million first proposed by Gov. William Donald Schaefer.
That would reduce Baltimore County's hit in the coming round of state cuts to $14.6 million, rather than $23.5 million in cuts it would sustain in the governor's plan. That means the county would keep $8.9 million it had expected to lose.
Mr. Hayden is supporting the Mitchell plan because it, plus the 5-cent gas tax increase, would ensure that the county would not face any more state budget cuts this fiscal year, which ends June 30.
The $8.9 million savings will mean no relief to the county's 19,000-person work force, which is facing the loss of five days' pay from furloughs.
Moreover, even if the Mitchell plan is adopted, the county will be forced to cut more services and possibly lay off employees because only four months remain until the end of the fiscal year, and Mr. Hayden already has cut nearly everything he could without resorting to lay- offs.
County budget director Fred Homan said the next round of local cuts will bring the county "down to our last red cent," by that final budget day.
The new estimate of the drop in county revenues -- some $12 million more than was expected -- mostly reflects a $19 million dip in income tax revenues due to the recession, Mr. Homan said.
The income tax deficit plus a $1.4 million drop in investment earnings, due to low interest rates and less cash to invest, are the two largest elements.
County budget officials had, for example, estimated a 1.25 percent increase in income tax revenues for the last three months of 1991 -- compared to the same period the year before. Instead, revenues dropped 1.08 percent. The economic recovery that county officials had expected by now hasn't happened, and may be delayed until late 1992.
The county executive and his budget director are waiting to see if the Mitchell plan is adopted by the General Assembly, or if one containing slightly lesser cuts to local governments, being discussed by some state senators, makes headway.