Budget makes sense for city

June 14, 1995

Budget writing is tricky for any big city today. Baltimore's continuing population loss has eroded its tax base. The federal government has decreased the funding it makes available to urban areas and the Republican Congress is threatening more draconian cuts. Against such a backdrop, Mayor Kurt L. Schmoke and the City Council have come up with a prudent $2.3 billion budget that retains current city services.

But they almost let politics get in the way. As to be expected in an election year, politicians are tempted to approve popular tax breaks that they hope will lead to additional votes at the polls. That must have been the motivation of some City Council members who fought for another nickel reduction in the property tax Monday night. It's fortunate that they didn't succeed. There has been no evidence that such a small tax break -- $9.18 for the average Baltimore household -- translates into fewer people leaving or moving into Baltimore. But it would cost the city at least $4 million.

It made more sense for the council and mayor to agree instead to repeal Baltimore's beverage container tax, although that also poses a risk at a time when the city must be concerned about any revenue loss. Mr. Schmoke, however, has found ways to cut other expenditures so as to absorb the $1.1 million cost of initially reducing the bottle tax. Its eventual end could lead to an increase in beverage sales in Baltimore, which would provide a needed boost to city businesses.

Those who rightly want to improve home ownership in the city should also keep in mind that the budget does keep intact one of the most generous homestead tax breaks in the state. There is a 4 percent cap on the amount of growth that will be considered in assessing owner-occupied residential property. That will provide $6.1 million in tax relief to 48,000 homeowners, which is about a third of all homeowners in Baltimore. Also continued will be the city's Settlement Expense Loan Program and the City Employee Home Ownership Program.

The budget's modest growth of 2.9 percent represents a realistic analysis of Baltimore's revenue expectations for the coming months. An anticipated 9.7 percent increase in state aid will allow that increase. Still, most city departments will not see their budgets grow by much, if at all.

The Police Department will get a 3.5 percent increase, raising its budget to $184.5 million. That should allow it to add 15 officer positions to the force. It is important to fill those positions and any others still unfilled among the 120 previous positions added to the force since 1994. Reducing crime will do more to stabilize home ownership than another nickel property tax reduction.

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