Leopold asks for $1.2 billion

Budget's 2.9% spending raise, tax increase anger school officials, tourism promoter

May 02, 2008|By Susan Gvozdas And Ruma Kumar | Susan Gvozdas And Ruma Kumar,Sun Reporters

Anne Arundel County Executive John R. Leopold unveiled a relatively lean $1.2 billion operating budget for fiscal 2009, angering school officials by only partially funding pay and benefits for system employees and riling a tourism promoter by calling for an increase in the county's hotel room tax.

With tax revenues from real estate sales down more than $29 million from a year ago, Leopold proposed increasing total county spending for the coming year by just 2.9 percent.

While holding the line on real estate and income taxes, he asked the County Council for other "revenue enhancements" by raising the lodging tax from 7 percent to 10 percent, collecting a $500 ambulance fee and increasing fees for restaurant inspections, well drilling permits and use of recreation and parks facilities.

Leopold, a Republican, offered $26 million in county funds to the school system, enough to pay for 6 percent raises for teachers and 3 percent for support staff. But his budget did not include funds for 6 percent raises for administrators or for expanded benefits packages for teachers and support staff.

"I have to work within the cold fiscal reality this county faces," Leopold said in an interview. "We live in a tax-averse county, where time and again it's been shown that the taxpayers want to see spending reductions, not tax increases."

Superintendent Kevin M. Maxwell said if Leopold's proposed budget was passed, it would be "devastating" and would harm the district's ability to compete with neighboring districts such as Howard County.

"If you want a Mercedes, you've got to pay for a Mercedes," he said. "We didn't even ask for a Mercedes. We asked for a Chrysler, and we got a pogo stick."

Under the plan, the school system - which accounts for half the county's overall budget - will get a total of $858 million in county, state and federal funding.

Of that amount, the county will contribute $570 million, $26 million more than this year. But school officials had requested an additional $77.5 million from the county, the bulk of which would pay for pay and benefits increases negotiated with teachers, administrators and support staff such as cafeteria workers, custodians and bus drivers.

Leopold said school officials are out of touch with the fiscal reality facing a county that has a shrinking revenue stream because of the real estate slump and a $15 million reduction in state funding.

Reaction from County Council members, who must approve the budget by June 1, was mixed.

Democratic councilmen Jamie Benoit and Joshua Cohen said the county needs to provide enough money to cover previously negotiated contracts. Benoit, who represents Crownsville, said that the executive's budget "doesn't, in my view, honor the commitment to the schools the way we should."

The council can subtract from Leopold's spending plan, or shift funds around, but not add to it.

A tourism official warned that Leopold's proposed increase in the hotel room tax could discourage people from booking hotel rooms in the county.

"If people think visitors don't look at the total checkout rate of hotels, car rentals, restaurant taxes, sales tax - all combined - and say it's just too expensive to that destination, then they are really out of touch with the American consumer," said Connie Del Signore, president and CEO of the Annapolis and Anne Arundel County Conference and Visitors Bureau.

The only other significant spending increases proposed by Leopold were a $5 million boost for Anne Arundel Community College and $2 million for a workforce housing initiative.

Nonprofits will see their funding increased by more than $600,000 to $2.3 million.

In his $214 million capital budget, Leopold proposed $92.7 million for school construction projects, including money to complete projects at Gambrills, Lake Shore and Freetown elementary schools. He also budgeted $6.5 million to build the Eastern Police Station.

Sun reporter Steven Stanek contributed to this article.

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