Panel to eye fiscal plans

Business, community leaders to review finances, taxes

Leaders to advise Leopold on taxes, county finances

March 07, 2007|By Phillip McGowan | Phillip McGowan,sun reporter

As he prepares the first budget of his administration, Anne Arundel County Executive John R. Leopold said he's forming a panel of community and business leaders to examine how the county can overcome a mountain of fiscal challenges - and support his push for new taxes.

His decision comes days after the chief executive of the Annapolis and Anne Arundel Chamber of Commerce urged Leopold to form such a committee, amid grave concern in the business community about the county's fiscal outlook.

Even as Leopold insists the county is "headed in the right direction" on the budget front, he said yesterday that he has asked Martha Smith, president of Anne Arundel Community College, to lead the committee.

The county executive said he would also ask Bruce Abbott, a Comcast executive and a board member for the county's Chamber of Commerce, and Walter E. Middlebrooks, president of the county's Black Chamber of Commerce, to participate. Leopold encouraged members of the Annapolis and Anne Arundel chamber to sit on the panel.

Leopold said the group would serve as "a sounding board for ideas that I would want to initiate." He said the panel would push his agenda for a car-rental tax in the General Assembly, which must grant the county the authority to enact such a levy. Leopold has also forwarded a bill to the County Council to raise the commercial bingo tax from 7.5 percent to 10 percent.

Leopold's proposed tax increases - which could generate as much as $5 million - have received mixed reviews from county lawmakers and the business community. Leopold said the "revenue enhancements" would not be a "direct hit on county residents," but others question whether those taxes would raise enough cash to pay for the county's extensive needs.

While a county spokeswoman said that Leopold has been weighing the idea of a panel for a few weeks, Bob Burdon, head of the Annapolis and Anne Arundel Chamber of Commerce, asked the county executive last week about tapping business leaders to review the county's numerous fiscal challenges and recommend budget cuts, restructuring and new taxes.

Burdon yesterday called Leopold's decision "very positive" and said the panel would validate Leopold's pledge to promote transparency in county government.

He said that a study group would "identify the magnitude of the problem" of paying for 10 union contracts, repair crumbling schools, restore waterways damaged by storm water runoff and fund growing retiree health care commitments to county employees. But Burdon said he didn't "see this as an advocacy panel."

While a state budget deficit - about $1.4 billion within a year - has been projected, few know whether the county is facing a deficit, and, if so, how big it would be. The county's current operating budget is $1.1 billion; some county officials estimate that spending must grow by $200 million to meet new demands.

"We are concerned about trying to get a handle on the potential deficit. ... I don't think anyone has a handle on that," Burdon said in an interview last week. "Anne Arundel County residents don't know there's any potential of a deficit, and the citizens need to know that."

Burdon predicted that Leopold will present an "austere" budget in May: "I think he knows that, and the [County Council] knows that."

County officials will offer a detailed budget forecast Monday when they meet with bond-ratings agencies in New York, but Leopold did not reveal numbers yesterday. He reiterated that he would not fully fund the school board's request for a 17 percent budget increase - or $133 million - over the current fiscal year.

The county executive has begun meeting daily with department heads in the prelude to his budget address. He said a recent review of the county's fiscal situation "leads me to believe that this ocean liner will be able to sail smoothly without hitting an iceberg."

phill.mcgowan@baltsun.com

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