Cutbacks, closures likely in Dixon budget

March 18, 2009|By Annie Linskey | Annie Linskey,annie.linskey@baltsun.com

Baltimore Mayor Sheila Dixon plans to unveil her budget at the Board of Estimates meeting today, a plan that is likely to include recreation center closures, shorter library hours and possible layoffs for some of the city's 15,000 employees.

The roughly $2.2 billion budget will close the $65 million gap Dixon announced in October, but City Hall officials familiar with the planning process believe the state may slice an additional $18 million from the city's funds. That would mean cuts to services proposed today could deepen.

City officials declined to comment yesterday on what Dixon plans to cut. The mayor plans to answer questions about her budget at a 10:30 a.m. City Hall news conference.

"The budget is more important this year than in recent memory," said Scott Peterson, the mayor's spokesman. "Everything is about the economy now."

He said that department heads have been working since October to develop a "budget that is fiscally responsible and protects priority services."

Peterson said there are no new taxes proposed, but he declined to comment on fees.

The expected state cuts, based on analysts' recommendations that could be changed by the General Assembly, could hit in a number of areas, according to officials familiar with the process.

The city is expected to pay an extra $3.7 million toward the costs of assessing home values. City taxpayers also may have to put an extra $2.1 million toward retirement contributions for sheriffs who work in the city, as well as pick up the salaries of 32 circuit court law clerks at a cost of $1.7 million.

The state may tweak the formula to the so-called disparity grant, a pot of money filled by wealthier communities to subsidize poorer parts of the state. Those changes would cost Baltimore $7 million.

There is one bright spot in the city's budget. Increased assessments in the southern area of Baltimore - including waterfront neighborhoods such as Canton and Federal Hill - mean the city expects to see a 6.2 percent increase in revenue from taxes paid by homeowners.

But forecasters do not predict that trend will continue. Home prices held steady in 2008 but fell by 16 percent in January, according to data from the city's finance department. And in all other areas, tax revenue is expected to be down.

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