State Gives Schools 11% More

Piggyback Tax Won't Rise, Says Neall

April 20, 1992|By Elise Armacost | Elise Armacost,Staff writer

Anne Arundel schoolchildren have emerged from this winter's state budget crisis richer, not poorer, than had been expected.

Their parents are also better off than they would have been if County ExecutiveRobert R. Neall had decided to raise the local income tax rate.

During the General Assembly session, Neall encouraged state lawmakers to give local governments authority to raise the "piggyback" taxrate from 50 to 60 percent of the state income tax rate. But he sayshis fiscal 1993 budget, to be presented May 1, will not include the increase.

A recent report by an executive-appointed Property Tax Commission showed that the county could raise an additional $26 million by raising the local income tax, but Neall decided he did not need to take that step this year.

The county ended up losing less statemoney in the current fiscal year than expected. Not only that, but as long as state revenue estimates hold up -- and experts stress that this is a very big "if" -- state aid to local government should rise to 1991 levels in fiscal 1993, which starts July 1.

The Board of Education stands to benefit the most. Schools are scheduled to get $113 million in state funding, up from $101.5 million, said Steve Welkos, county budget officer.

The lion's share of the increase came through a jump in the state's APEX allocation for basic educational expenses. Money for APEX increased from $77.6 million to $91.8 million, while money for school transportation and for programs for disabled students was reduced.

The local school boards decide how APEX money is used.

Although state law required the APEX increase, local officials had expected the General Assembly to amend the law, reducing the amount. "Nobody would have ever thought the General Assembly would have fully funded that APEX," Welkos said.

In fiscal 1993, the county is slated to receive $155.5 million in state money. That's $12 million more than it received this year after budget cuts, and only slightly less than the $156.8 approved for fiscal 1991.

Like public schools, Anne Arundel Community College will get an increase. The college is expected to get $7.2 million in state money, up from $5.8 million this year.

Money for libraries is expected to decrease from $1.7 million to $1.1 million.

State grants to the Police Department are set at about $3 million, the same as this year and $800,000 less than in fiscal 1991.

The Health Department is expected to lose more than $1.5 million in state money in fiscal 1993. This year, it received about $8.9 million. Next year, it stands to get about $7.3 million in state grants and general aid, plus additional money for specific programs and for mental health, said Evelyn Stein, spokeswoman for the department.

Overall, "it's a pretty stable situation," thanks in large part to cost-cutting measures taken by Neall last year, Welkos said. "I don't think there's anything absolutely devastating."

The new budget should come in around $616 million, which is what thisyear's budget was before the state started cutting millions in aid to local governments.

Still, Neall warned this week that the county's financial troubles are far from over.

The $155.5 million state aid figure could be reduced if, as Neall and some budget experts suspect, the state has overestimated its income tax revenue. The state projects a 6 percent increase in income tax revenue, while most analysts predict only 2 to 3 percent growth.

If the state budget is basedon faulty revenue estimates, the county could be in for the same kind of financial trouble it endured over the past year, when the executive had to slash programs and ask for employee wage concessions.

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