Panel says Balto. County budget can grow

Affordability committee OKs $67 million increase based on economic health

January 22, 2001|By David Nitkin | David Nitkin,SUN STAFF

Despite an economic slowdown expected to erode Baltimore County income tax revenue, County Executive C.A. Dutch Ruppersberger should have an additional $67 million to spend as he prepares next year's budget, a study group has concluded.

The county Spending Affordability Committee recommended last week that the budget could be allowed to grow by more than 5 percent in the fiscal year that begins July 1. The current operating budget - which pays for police, fire, trash pickup and most other municipal services for 724,000 residents - is $1.2 billion.

If the committee's recommendations are followed, the county would have more money to spend on schools or other priorities without an increase in income or property tax rates.

"I would characterize it that the fiscal health of the county is very strong," said Michael Funk, a senior economist with RESI of Towson University, a forecasting group. "The prospects for continued growth are in place."

Funk is one of five members of the affordability committee, which also includes three County Council members and a business owner. Created a decade ago, the panel is charged with preventing county spending from outpacing the growth of the local economy. If the County Council approves a budget that exceeds the committee's guideline - something that has never happened - it must write a statement explaining why.

Projections from the county auditor show a slowdown in revenue growth, from 3.7 percent in each of the past two years to 1.4 percent in the coming fiscal year. Healthy growth in property taxes would likely be countered by a reduction in income taxes. With many stocks performing poorly, county officials are anticipating a lower capital gains tax collection.

Still, the county's economy remains strong, forecasters say. The county is expected to maintain the prestigious triple-A bond rating it has been awarded by the major Wall Street rating agencies. That means taxpayers would pay the lowest possible interest rate on money borrowed for roads, schools, parks and other projects.

Ruppersberger will propose a budget in April; the council can make cuts but cannot increase spending.

Councilman T. Bryan McIntire, a north county-Owings Mills Republican who is a member of the affordability committee, offered a prospect for property owners: "I'm very hopeful that our health is sufficient that we can reduce the tax rate next year."

While McIntire has unsuccessfully floated the idea of a tax cut in past years, he said "I feel there is more sentiment among my fellow councilmen this year than there has ever been."

But Ruppersberger is "not ready to make any announcements about a tax cut because he is still working on his budget proposal," said Elise Armacost, a county spokeswoman.

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