Leopold sees cutbacks ahead

After swearing-in, county executive calls for effort to trim spending up to 10%

Leopold is sworn in, warns of budget cuts

December 06, 2006|By Phillip McGowan | Phillip McGowan,Sun Reporter

New Anne Arundel County Executive John R. Leopold said he is asking county departments to prepare for spending cuts of between 5 percent and 10 percent for the next fiscal year, in anticipation of a drop in projected tax revenues.

"It's important to send the message that this administration is serious about reducing costs," the 63-year-old Republican said in an interview after his swearing-in Monday. He stressed that residents will receive "quality service."

Leopold said he has met with County Council members individually to discuss revenue options. He previously has said one option might be to raise impact fees assessed to developers on new homes as a way of paying for roads and schools. The county's current operating budget is $1.1 billion.

Anne Arundel budget officials have estimated a $15 million decline in county real-estate tax revenue and are bracing for a projected state budget shortfall. General Assembly analysts estimated last month that state spending is outpacing tax receipts by about $1 billion a year unless Gov.-elect Martin O'Malley and the General Assembly make a major policy shift.

"We have some tough times ahead," said Councilman C. Edward Middlebrooks, a Severn Republican. "Hopefully we will lead the county in the right direction."

Leopold took his oath of office Monday morning as Anne Arundel's seventh chief executive before an audience of more than 100 people at the Arundel Center in Annapolis.

Sworn in that afternoon were returning Republican County Council members Middlebrooks, Ronald C. Dillon Jr., Edward R. Reilly and Cathleen M. Vitale, and new Democratic members G. James "Jamie" Benoit, Josh Cohen and Daryl D. Jones.

In a separate courthouse ceremony, Democrat Ronald S. Bateman became the county's first new sheriff in 12 years. He succeeds George F. Johnson IV, who lost to Leopold in the executive's race by a razor-thin margin.

Amid the standing ovations and the handshakes, several of the county's elected officials hinted at the costly expenses just around the corner: road upgrades and an expansion of mass transit around Fort Meade; the negotiation of 10 union contracts; growing commitments for retirees' health care; and school construction and renovations.

Schools Superintendent Kevin M. Maxwell will present his budget proposal to the Board of Education on Jan. 3. Budget meetings with department heads are continuing, according to a school system spokesman.

As for the tight budget projections, "certainly we're aware of it," said Bob Mosier, a school system spokesman. "And as we look at putting final numbers on the budget, we certainly have that, among other factors, in mind."

Shortly after Leopold's brief inaugural speech, the successor to two-term Democrat Janet S. Owens told several reporters that he had cut nearly $1 million from the budget by eliminating four positions, including chief of staff, and making other structural changes.

"Save a million dollars here, a million dollars there, and soon you are talking real money," Leopold said.

The former state delegate is also meeting with members of the county's legislative delegation to make the case for funding help. The General Assembly directed $373 million in operating and capital funds to Anne Arundel County for the current fiscal year, an increase of nearly $50 million over the previous year.

Budget Director John Hammond said it is premature to predict whether the county will receive fewer state dollars. He noted that O'Malley "aggressively wants to fund [the Thornton education plan]. He wants to aggressively fund school construction. What you hear from the governor-elect is he's sending money to the counties."

Anne Arundel County officials have repeatedly stressed that state and federal funding will be critical to pay for massive infrastructure improvements around Fort Meade as 20,000 public- and private-sector workers relocate there in the next five years.

Leopold wants to pursue other priorities that will cost money, such as restoring waterways that have been ravaged by storm water runoff and expanding the stock of affordable housing. He has said he can accomplish both without raising taxes, in part with the help of public-private partnerships.

Some council members applauded Leopold's early efforts to find cost savings, but they said that the budget was already fairly trim.

"It's certainly a noble goal," said Benoit, of Piney Orchard. "I just don't know how much he can cut."

Dillon, a Pasadena Republican who was appointed chairman Monday, said he has already spoken with Leopold at least three times on budgetary issues.

Dillon said he has asked Hammond and County Auditor Teresa Sutherland to make a presentation to the council in January on future health care retirement costs and provide an overview of the county's finances.

An accounting change for the fiscal year that begins July 1 will require governments to report the size of their health care commitments for current and future retirees. That annual price tag could be in the $75 million range, according to county estimates.

Hammond said that health care figure is a "moving target." As the budget review process kicks into gear later this month, one issue will be determining the level of retiree benefits that the county will provide, he said.

"You know, we will get through it," said Dillon, noting the county has gotten through financial difficulties before. "You can't be too doom and gloom."

phill.mcgowan@baltsun.com

Sun reporters Anica Butler and Andrea F. Siegel contributed to this article.

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