The Calvert County commissioners could decide Tuesday on a "flat" operating budget for fiscal year 2004, essentially rejecting all spending increases requested by agency heads, elected officials and others seeking county funding.
Moreover, such a decision would likely turn away organizations that are seeking new financial help from the upcoming budget, according to Board of Commissioners President David F. Hale (R-Owings).
"It means you aren't going to be in the budget this year either," Hale said of the message that a flat-budget policy would send to such groups.
The Board of Commissioners whose terms ended in December already had directed county staff to develop a fiscal 2004 operating budget with no spending increases because they anticipated slashed state funding as officials in Annapolis resolve Maryland's fiscal problems. On Tuesday, the new board will consider whether to continue the practice of scheduling special meetings with agency heads, elected officials and others seeking spending increases.
That decision, Hale said, will prompt a discussion on whether the county's zero-growth budget policy should apply to everyone. Such a decision, however, could complicate the commissioners' consideration of areas where they would want to make exceptions to the flat-budget mandate. Logical exceptions would include funding for education, public safety and parks and recreation, which is anticipating additional employees as part of an already approved plan to add park space, according to Hale.
"When we we talk about the zero-growth policy, are we going to allow exceptions to it?" Hale said.
Even a zero-growth policy would call for some spending increases, albeit minimal. "A flat budget also doesn't mean that nobody gets a promotion, that nobody gets a step increase," Hale said.
The 2004 budget covers the 12-month period beginning July 1. County staffers plan to introduce their proposed budget to the public in March. Staff has already assembled a $26.2 million Capital Improvement Program budget plan for the coming fiscal year, with nearly a third of the proposed construction spending on building or improving schools.
Ultimately, depending on the degree of the state spending cuts, the commissioners may be forced to look for more revenue even if they stick to a streamlined budget.
County finance officials already have presented the commissioners with a list of possible tax or fee increases. That list included a last-minute proposal to ask the state legislature for authority to impose a new real estate transfer tax.
Tax increases, including the proposed real estate transfer tax, were reviewed by the commissioners last month during an orientation session for the new board. Unlike the commissioners' regular weekly meetings, that session was not open to the public or the news media. The commissioners classified the gathering as an "executive function," which may be closed. According to a manual for the state's Open Meetings Compliance Board, the executive function exception allows meetings to be closed as long as elected officials are not developing "a new policy."
However, in response to an inquiry about the Calvert orientation session, an assistant state attorney general previously said that discussion of a new tax "sounds like a policy," and thus should have been conducted in public. Hale has maintained that the board did not actually discuss the tax during the presentation. Hale has since said that the board would not discuss those revenue matters until it considers funding requests.
"I think it's unfair to talk to the board about funding issues, tax increases or whatever we're going to call it, before the board, particularly the three new members, have the opportunity to go through the CIP and two or three operational work sessions," Hale said.
The state budget crunch already is being felt in Calvert, which was Maryland's fastest-growing county during the 1990s and continues to face increasing demands on roads and school facilities.
In September, state transportation officials told the county commissioners that money woes had caused a halt to Calvert's top priority road project -- improvements at the busy intersection of Routes 2/4 and 231 in Prince Frederick. And just recently, Calvert learned that it stands to lose $1,670,911 in state funds that are used to help pay for the repair and maintenance of local roads.
A bigger concern, however, is whether state funding will be cut for building and expanding schools. Calvert is constructing a new high school in Huntingtown.
Also complicating the revenue picture is the potential loss of state payments for income lost as a result of Maryland's deregulation of electric utilities. In a memo to the previous Board of Commissioners, a county budget analyst wrote that the state budget shortfall has significant potential of decreasing the sources of revenues for Calvert County, including state reimbursements -- projected to be $6.1 million -- for revenues lost from its biggest taxpayer, the Calvert Cliffs Nuclear Power Plant, because of deregulation.