As if trying to stem the city's murder rate and to move mounds of snow weren't test enough, Mayor Martin O'Malley faces a $20 million deficit in balancing his first city budget while union contract negotiations with 16,000 city employees get under way.
City budget officials will present a preliminary 2000-2001 budget to the Board of Estimates on April 1. They have been able to trim the damage of what was projected to be a $31.5 million shortfall for the next fiscal year, which begins July 1.
Baltimore's long-predicted structural shortfall -- tax income that has fallen below city spending -- is expected to wash ashore in the first wave of projected annual deficits. They are expected to build to a projected cumulative $153 million deficit by 2003.
"Our problem is our revenue base is just not growing," said city budget director Edward J. Gallagher, who will present his 18th city budget under his fourth consecutive mayor.
Under state law, the city must pass a balanced budget, meaning that no deficit is allowed. That will press the new mayor and department heads to begin the tough task of trying to rein in runaway spending in a city with a shrinking population -- or find alternative funding.
O'Malley, Gallagher and Baltimore state legislators are hoping that Gov. Parris N. Glendening -- sitting on a $1 billion state surplus -- will provide short-term help to the city when his supplemental state budget comes out in March.
But even a state boost won't change the city's need to drastically change the way it operates to fend off future red ink.
Over the past five years, citizen watchdog groups have followed city budget hearings, seething at Baltimore's avoidance of certain budget choices that other big cities have made, such as reducing the work force or opening city services to private competition.
That procrastination, critics say, has left the budget mess squarely in O'Malley's lap.
"I'm somewhat sympathetic to the fact that there is an outgoing administration and an incoming administration," said George Nilson, an attorney and former president of the Baltimore Homeowners Coalition who served on O'Malley's finance transition committee. "Yet the new administration needs to deal with the issue early."
Poor timing for raises
