May 11, 2005|By Lisa Goldberg | Lisa Goldberg,SUN STAFF
Baltimore County's revenue picture for the coming fiscal year appears to be rosier than County Executive James T. Smith Jr. projected in his proposed spending plan -- by about $12 million, the county auditor said yesterday.
But the county likely will need to make tough budget decisions over the next few years to prepare for new accounting standards that could force governments to set aside millions of dollars annually to ensure that they can pay for future retiree health and insurance benefits, auditor Brian Rowe told the County Council.
The accounting change, which goes into effect for the fiscal year that begins July 1, 2007, likely would increase the county's budget by $68 million a year just for government employees, and the cost for education employees is expected to be even higher, he said.
Not setting the money aside could affect the county's bond rating, Rowe told council members during the first day of hearings on the executive's $1.45 billion general fund budget.
The concern over funding future benefits was the only "red flag" raised by Rowe during his presentation, although the auditor expressed concerns that the budget for snow removal, which was increased from $2.9 million this year to $5 million next year, is still too low.
But the budget proposal also underestimates the amount of money the county can expect to collect in income and real estate transfer taxes next year, Rowe said.
The council, which is planning to hold a series of budget sessions into next week, is expected to approve a budget May 26.
