By Michael Laris
Washington Post Staff Writer
Saturday, January 16, 2010; B01
The vast physical presence of Montgomery County's government -- from clinics and classrooms to roads and fiber optic cables -- would get a $4 billion jolt over the next six years under a capital spending plan detailed Friday by County Executive Isiah Leggett.
The proposal represents a nearly 7 percent boost in spending and contains little of the sort of dour news that has come to dominate recent fiscal pronouncements in Montgomery and across the Washington region in the aftermath of a deep recession.
Top Montgomery officials said there is nothing inconsistent about their ambitious construction plans and their simultaneous alarm at an operating budget shortfall that they have said could reach $600 million.
The drop-off in tax revenue presents an immediate problem for the day-to-day operating budget, but much of the money for capital projects such as schools, roads and parks is borrowed, often with a 20-year payment period.
With interest rates low and construction companies hungry for work, Montgomery officials said, the county should take advantage of the community's general affluence to press ahead with its capital priorities, especially those affecting education.
That was the argument Leggett (D) made Friday to a cheering audience in the library at Paint Branch High School in Burtonsville, where Principal Jeanette Dixon said Leggett's funding proposal "will forever mark him as the 'Education County Executive.' "
Construction began this month on a building to replace Paint Branch, which was built in the 1940s. Students bump into one another in the narrow hallways, and new lab space and other improvements are needed, Dixon said.
"It may be counterintuitive for some" to have such a large capital budget now, Leggett said. But "exceptionally low" building costs will "save the county millions of dollars," he said.
Constructing a new Paint Branch, for example, is expected to cost $20 million to $30 million less than what was spent on a similar school that was built recently, schools officials said. The county can build an elementary school with the difference, they said.
"They are cheaper now, and people want to build them. It's like a no-brainer," said Superintendent Jerry D. Weast, who compared Leggett's leadership to that of Abraham Lincoln.
Capital spending would rise 9 percent over six years for general county government and 17 percent for the school system.
Among the new and ongoing projects in the capital budget is the planned replacement of the health clinic at Dennis Avenue near Silver Spring, which was has been used in recent months as a vaccination center. Spending to modernize traffic signals would be accelerated after a system meltdown last year.
Although Montgomery's affluence gives officials the confidence to borrow and build, mounting debt remains an issue. The county says its debt now exceeds $2 billion, and the amount set aside for debt service in this year's operating budget grew to $249 million, nearly as much as the county spends on Montgomery College. And the latest building proposal will push that burden higher.
The borrowing envisioned in the six-year capital budget falls within limits set by the County Council, but it would push a closely watched ratio higher than it has been in recent memory, officials said. County policy calls for a ratio of debt service-to-county revenue of about 10 percent. This plan would push the ratio past 11 percent in some years.
The county's chief administrative officer, Timothy L. Firestine, said other indicators give him confidence that the county will have no trouble paying its debts. Still, he said, "I wouldn't go above this."
The capital budget has to be approved by the County Council. Council President Nancy Floreen (D-At Large) said she is pleased to see the commitment to the school system. "I think we can probably afford this, under the circumstances," she said.