Stung by public outrage over a proposal to shutter Baltimore's recreation centers, city officials are scrambling to cover an $18.1 million shortfall in next year's budget without major cuts by tapping into a pension surplus and drafting increased user tax fees.
Mayor Kurt L. Schmoke postponed for a week today's scheduled release of the preliminary budget for the fiscal year that begins July 1 to give his top finance officials time to come up with a plan that would minimize deep reductions in city services and subsidies.
The postponement came after a meeting Monday with other top elected and appointed officials who make up the Board of Estimates, the five-member panel that considers budget matters before they go to the City Council.
At the meeting, Schmoke agreed not to close any recreation centers and also pledged not to seek an increase in either the property tax or the "piggyback" income tax. But higher energy and parking taxes are among the items under consideration, officials said.
City finance officials proposed closing recreation centers and most parks in an early draft of the budget. When word of that proposal leaked out, residents bombarded top officials with calls and protested Monday outside recreation headquarters in Druid Hill Park.
That proposal also slashed all city funding to cultural institutions, such as the Baltimore Museum of Art, and called for the abolition of the Office of Cable and Communications.
"What will be presented will be a budget without the dire consequences contained in the earlier version," Clinton R. Coleman, the mayor's spokesman, said yesterday, adding that the early budget plan was "unacceptable to not only [the mayor] but the citizens."
City Council President Lawrence A. Bell III said yesterday that the delay in the release of the preliminary budget would prevent the administration's annual calls for draconian reductions that are proposed but never come to pass.
"The long-term impact is so negative," said Bell, who chairs the Board of Estimates, though the mayor controls the majority of votes. "It creates the false impression that the city is falling apart. That lasts beyond when we solved the problem."
Comptroller Joan M. Pratt, also a board member, said yesterday that revamping the preliminary budget proposal was the best thing to do.
"I don't feel it is necessary to put out a budget when the final budget will be completely different," Pratt said.
According to last month's budget projections, the bulk of the $18.1 million shortfall in the city's $823 million general fund comes from pay increases for employees, who did not get a raise last year. The general fund is the city's principal operating fund and makes up about a third of the $2.3 billion budget.
Pay raises include already-negotiated 3.5 percent raises for police ($4.2 million) and the Fire Department ($2.4 million) and budgeted 2.5 percent raises for other city workers ($3.9 million), for a total of $10.5 million next year.
The latest projections indicate a $2.4 million drop in property tax receipts and a $2.7 million decline in the bottle tax revenue that will only be partly offset by a $3.2 million increase in income tax collections.
The shortfall takes into account $13.2 million in general fund savings from the city's early retirement program. Overall, 1,075 employees took advantage of the program, including 428 who were in positions paid for by general fund money. Three-quarters of those positions have been held vacant, officials said.
Officials are considering closing part of the shortfall by tapping into the $55 million surplus in police and fire pension funds.
Bell said that he wants to use $11 million of that money to increase benefits for about 3,000 older retirees. But a portion of the remainder could be used to reduce the city's $21.5 million contribution for the coming fiscal year, he said. Some surplus would remain.
Among the tax proposals being considered is an end to energy tax exemptions for nonprofits that had been considered but rejected last year, officials said. Also under consideration is a plan to change the method of calculating parking taxes to net the city more money.
"All of it is on the table," Coleman said.
Bell promised to keep an open mind about any proposal but said, "I would like to minimize reliance on higher taxes. I believe we can."
Pub Date: 4/02/97