County Executive Charles I. Ecker faces some new options on taxes for county residents and old choices on pay raises for county employees.
In the fiscal 1993 operating budget Ecker will send to the County Council tomorrow, he may include a modest raise for most, if not all employees, but virtually no new programs. He has remained mute about possible tax increases other than to say he hopes they won't be necessary.
Ecker has choices about raising taxes this year he didn't have last year. He can increase the property tax rate or the piggyback income tax rate or both. The piggyback tax is a percentage of state incometaxes and is collected for local use.
Until now, the maximum percentage was 50 percent, which is what Howard County collects. This year, local government can collect 60 percent, or it can designate any one of the incremental, even percentages in between -- 52 percent, 54 percent, 56 percent or 58 percent.
If Ecker chose to increase the piggyback tax to the 60 percent maximum -- something he has said he is loath to do -- the county would recoup an estimated $22.1 million more in revenue for fiscal 1993. The total includes a one-time only windfall of $6.7 million for the last six months of fiscal 1992.
If the entire 60 percent were collected, the piggyback tax for a county resident earning $50,000 with a $40,000 adjusted gross income would rise $194, from $971 to $1,165. To raise a similar amount on property taxes, Ecker would have to raise the rate 30 cents per $100 of valuation.
County residents who have an adjusted gross income of $100,000 and couples who have an adjusted gross income of $150,000 will alsobe contributing more to county revenue. The General Assembly put those residents in a new state income tax bracket for the next three years. The county portion of their taxes for fiscal 1993 alone is expected to produce $847,000. The county is expected to receive a one-time only windfall of about $396,000, since the new bracket is retroactiveto Jan. 1.
Another $1.2 million is expected to be generated by a 5 percent hotel tax that would apply mostly to transients.
The so-called constant yield tax rate -- the rate the county would have to charge this year to receive the same property tax revenue as it did last year -- is estimated to be $2.48, or 11 cents less than property owners pay now. If the property tax rate remains at $2.59 per $100 of assessed value, the county should receive about $5.5 million more this year than last.
At current rates, the owner of a home assessed at $150,000 pays $1,667. The property tax on such a house would increase about $6.45 for every penny added to the tax rate, if Ecker chooses that option.
When state aid of $4.6 million for education and $6.1 million for road construction is included, the county should have total revenues of about $276.4 million for fiscal 1993. That is only $600,000 short of what department heads asked for in March.
Their budget requests, which are certain to be trimmed, did not include newprograms or salary increases. Ecker has said that he does not want county employees to go two years without salary increases. Employees took a 2 percent cut this year because of a 5-day unpaid furlough.
Longtime workers were hit even harder, but they are expected to receive a longevity pay increase in fiscal 1993 that altogether will amount to between $600,000 and $700,000. The longevity raise is an annual bonus given to some county employees, based on length of service.
Last year the raises were eliminated for one year. Because Ecker has not asked for legislation to eliminate the raises again this year, the raises are likely to be included.
Ecker took exactly the opposite stance on merit pay increases. He has asked for a bill that would allow the county to pay less than the 5 percent mandated by county law. Merit raises of 5 percent would add about $1.3 million to the budget.
Members of the Coalition of Public Employees, a group made up of leaders of employee unions and professional associations, met with Ecker last week but "didn't accomplish anything," said spokesman Al White.
"We won't know anything definite about raises until tomorrow," White said. "The only thing he told us is no piggyback tax."
Ecker will hold a press conference on his budget proposal at 4 p.m. tomorrow and present it in summary form to the County Council at 7:30 p.m.