A Budget Its Makers Can't Decipher

COMMENT

June 06, 1993|By ELISE ARMACOST

Chances are, the only thing Anne Arundel residents know for sure about the $663 million budget that the County Council just approved is that it gives them a hefty tax break.

There's a lot more to this budget than that, but you can't blame ordinary citizens for not knowing what that is.

The people who drafted the thing can't even agree on what's in it, much less what its contents mean for the future of this county.

The question of pay raises for school and county employees is a good example.

County Executive Robert R. Neall did not include them in his original spending plan; with a property tax cap that the voters approved last November hanging over his head, he said he couldn't afford them, although he later promised workers that he would considering giving them a raise in mid-year.

Meanwhile, the County Council, controlled by a four-member bloc, disagreed. When it struck the budget last week, its members announced that County Auditor Joseph Novotny, who reviews the executive's budget, had found money for the raises and asked Mr. Neall and the school board to grant them.

No one argued about where the school board money was found; the council simply suggested that $3.2 million for new guidance counselors, etc. be used instead for salary hikes.

But Mr. Neall insisted that the $2.1 million that the council found for the county raises is not there. The council only cut enough money from the budget, he said, to offset its hefty tax cut. He insisted that said he would have to make additional cuts to fund the pay raise.

Hold on. Council Chairman David G. Boschert said the money is there, in a "contingency fund" (except that the only free money in the contingency fund is $500,000 the council never asked for.)

Mr. Boschert was not totally wrong. The money is there -- not in a contingency fund, but in the county's fund balance, essentially money left over from the current fiscal year that ends June 30. Mr. Novotny explained that he took unspent money and killed the projects attached to it so the cash would roll into the new budget as surplus.

Confusing enough? We're not done.

Mr. Neall's chief administrative officer, Dennis Parkinson, later conceded that Mr. Novotny is right; the money is there. But the administration believes the projects for which it was originally intended -- road resurfacings, mainly -- are more important than the pay raises.

"We don't need to have pay raises at the expense of some of these critical projects," he said.

Maybe not. But that does not justify the administration's casting of the council as mathematically illiterate. Nor does it mean, however, that what the council has done to Mr. Neall's budget was particularly intelligent.

Anne Arundel County has suffered massive cuts in state aid as well as declining revenues due to the recession these last two years. The new property tax cap that voters approved promises to exacerbate the county's financial woes by further restricting revenues.

Mr. Neall managed to contend with these problems in his proposed $668 million budget by downsizing government and tailoring a four-cent property tax cut with limits on assessment increases. As a result, homeowners would have seen modest tax relief while the county did not have to cut services as much as it would have with tax cuts alone.

The plan might have worked but for the council, which slashed the tax rate by another four cents and cut deeper into county services.

It's a move that could bankrupt the government.

No doubt an 8-cent tax cut looks good to the average homeowner right now. But as the county continues to grow that cut could prove more curse than blessing. The county budget office estimates the combined tax cap and cut will cost the county almost $200 million in anticipated revenues by the decade's end.

That's $200 million less to spend on schools, libraries, roads, ballparks and police protection. It's also less money to spend on cost-of-living raises for county workers.

Before the county goes without needed services or starts drowning in red ink, chances are new taxes will be passed to replace the lost property tax revenue. Indeed, Mr. Neall already can increase the county's income tax.

But you won't hear council members talking about that.

They're too busy congratulating themselves on their budget coup.

Elise Armacost is The Baltimore Sun's editorial writer in Anne Arundel County.

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