Montgomery County Executive James P. Gleason said last week he will recommend a reduction in the county tax rate when he unveils his fiscal 1979 budget Wednesday. Gleason declined to say how much of a reduction he would propose.
However, Gleason, speaking at a press luncheon, said property tax legislation pending in Annapolis could not only interfere with a county tax cut but would "force us to go into a slight property tax increase."
Gleason said the county's final decision on property tax rates will depend largely on whether or not the legislature approves Acting Gov. Blair Lee III's proposal to tax homeowners at 45 percent instead of 50 percent of market value. The plan would cost the county about $17 million to $18 million in revenues.
The new budget, it was reported, will contain a 6.8 percent pay increase for county workers and a 5 percent raise for school employes.
"The word is that Mr. Lee will get his property tax rate reduction," said Gleason as he spoke out angrily against Lee's proposal in a speech to the Montgomery County Press Club. He said Lee "will take away any of the growth in assessments in Montgomery County with his proposal" and noted that a cut in assessments would use any tax surplus the county once estimated it would have.
Montgomery County's potential surplus has been estimated at $22 million by Arthur Spengler, county fiscal officer.
"But I have to go with conditions as they are," Gleason said of his intention to propose a lower tax rate. "It may be difficult to maintain existing services. I don't really know."
Council member Neal Potter, an economist, commented that "at the present assessment rate, the property tax rate could go down about 20 cents [per $100 assessed valuation]. But if there is a cut in the assessment [rates], we' a cut in the assessment [rates], we'll have a tough time keeping the tax rate down." potter said if Lee's proposal goes through, property taxes might rise by cents per $100 of assessed valuation.
The average property tax in Montgomery County is $3.75 per $100 of assessed valuation, with the specific rate depending on location and services.
If assessments are cut, said Potter, the council will be "reluctant to wipe out the surplus" by using it to cover the loss in expected taxes that Lee's bill would cause. potter said the council might want to use a surplus for other things, such as education services. "Federal aid for education is very unreliable," said Potter. "It can get cut off."
Gleason's budget for fiscal 1979, which begins July 1, will be submitted to the County Council. Some county agencies have asked for more than expected, according to John W. Short, director of the budget office. Even with out increased appropriations, Short added, inflation is expected to boost the cost of operating county government from the current $516.6 million to an estimated $550 million.
The county, meanwhile, expects to lose at least $2 million in state aid to education and $2.5 million in federal aid, according to Short. Last year the county received $107 million in federal and state monies.
The county's assessment base is up from $6.445 billion to $7.2 billion, according to Short. Of that, $109 million is in new construction, he said.
The public school system, which last year received 51.9 percent of the countys budget, this year asked for funding that is about $16 million more than last year and $3 million more than recommended by the County Council. Super intendent Charles M. Bernardo recommended a $270.8 million budget and the school board increased it to $271.6 million.
"Berbardo recommended more than I expected," said Short, "and I thought the school board would cut somethings, but instead they added."
The budget may include some type of a youth program. "I'm wrestling with it," said Gleason. The problems [of youth] also involve the school systems."
Gleason said results culled from meetings and from testimony at the seven hearings he initiated on the problems of youths show that 80 percent of the problems are school-related. "And [the schools] have made it clear the county government has no control over that. But I'll recommend something in the next two weeks."
Short said the budget will also contain a 6.8 percent pay increase for county police based on an agreement bewteen the Fraternal Order of Police and county officials during the last few weeks. Although collective bargaining is not allowed in the county, organizations representing a majority of a group of employes such as police can "meet and confer" with county officials to discuss working conditions and salaries. The total package for police, including salary raises, and allowances for clothing and cars, will cost the county an additional $3 million, said Short.
The remainder of the 5,000 county employes, who did not negotiate as a group, will probably also get a 6.8 percent cost-of-living increase in Gleason's budget, according to Short. "I think they'll be reasonably happy with it," said Short.
School employes, whose negotiated raise the county refused to fund fully last year, are scheduled for a 5 percent raise this year, according to their three-year contract with the school board. Last year, they negotiated with the school board for 6 percent but the county only funded 4.2 percent, leaving the school board to find money for the remainder by cutting from other portions of the school budget. The increase of 5 percent this year accounts for $10 million and represents most of the increase in the recommended shcool budget over last year's funded budget.
"I think Gleason will go with a 5 percent pay raise for school employes," said Short. There are 11,500 school employes.
Council member Esther Gelman said she thinks teachers should get the raise. "Last year, we treated the school system shabbily," said Gelman. I think the teacher's salaries are a given. That's a contract between the employes and the board. The council should have complained when the contract was written, if they didn't like it."
Council member Neal Potter said he also would like to see school employes as well as county employees get a 5 percent salary increase.
Potter said he would like to see two different programs added to the budget for this coming fiscal year. One is a rent relief program for people under 60 years of age who are not covered by the state's program for those over 60. The program, which would cost $1 million to $3 million, according to Potter, would provide a graduated system of relief for people whose rents, under a set level, exceeded a certain percentage of their incomes.
"The council pretty much committed itself to a rent relief program when it got rid of rent control," Potter said.
The second item would be a "circuit-breaker" program for persons under 60 who are not covered by the state's circuit-breaker program. Such a program would provide relief for persons whose property taxes exceeded a certain percentage of their income, but with certain restrictions.
"If somebody with a $20,000 income wants to live in a big house, the county doesn't have to relieve him of his property taxes," said Potter. The council man said a county circuit breaker program would cost about $3 million to $6 million.