City's Board of Estimates to seek funds to hire firm to find new finance director

Watson, lauded for growth of rainy-day fund, to retire

September 29, 2004|By Doug Donovan | Doug Donovan,SUN STAFF

The city's Board of Estimates is set to hire an executive search firm to find a replacement for retiring finance director Peggy J. Watson, whose impending departure was inadvertently revealed by City Hall yesterday.

The board's draft agenda for today's meeting features an item that states that "the department of Finance will soon require the services of a new Director of Finance." The item requests that the board spend $25,000 to hire an executive search firm to hire Watson's replacement.

Steve Kearney, a spokesman for Mayor Martin O'Malley, confirmed Watson's retirement, but said the item would not appear on the board's final agenda today because she was on vacation. He said the board will consider the item after she returns.

Watson could not be reached for comment.

The finance director faced a challenging year in which she had to recommend a $2.1 billion city budget that could be balanced only by fee increases or severe cuts, including layoffs. Watson was also forced to use city government savings that had been accumulated during the past several years to help the schools avert financial insolvency.

"The O'Malley administration is going to have big shoes to fill," said City Councilman Kenneth N. Harris Sr. "Peggy is the person in the O'Malley administration that has helped us get through these tough budgets."

O'Malley frequently credited Watson for engineering the $42 million schools bailout and for building up the $56.2 million rainy-day fund that made it possible. She built the fund from $17.6 million in 1999.

After his election in December 1999, O'Malley lured Watson, then 52, out of retirement to run the city agency where she had worked for two decades. She first entered city government in 1976, occupying several posts, including assistant treasurer, associate treasurer and supervisor. From 1987 until her retirement in 1997, she served as deputy finance director.

At the time of her appointment, the mayor said that "no one knows more about the finances of the city of Baltimore than Peggy Watson."

She has also served as a voting board member for Catholic Charities, Baltimore Development Corp., Lexington Market Inc., Baltimore Public Markets Inc., and the Parking Authority of Baltimore City.

It is unclear when the Board of Estimates will reconsider the request from the Department of Human Resources to hire the search firm, Mercer Group Inc., to find Watson's replacement.

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