Calvert County employees are in line for a 2 percent pay raise under the proposed budget presented to the public at a hearing Tuesday evening.

County commissioners reversed their earlier position against including raises in the fiscal 2005 budget after new economic forecasts projected an unexpected increase in government revenue.

With the pay increase, the proposed budget calls for spending $160.7 million in the fiscal year that begins July 1.

Just a month ago, a majority of the five commissioners had voted to give employees a one-time lump-sum payment instead of a raise that would adjust the overall pay scale and carry over to subsequent years.

Terry Shannon, the county's director of administration and finance, said the commissioners' decision to give the employees a cost-of-living adjustment -- a COLA in the parlance of the budget writers -- was prompted by the improved revenue picture, including projections of increasing income tax payments from residents during fiscal 2005.

"Because things have improved, they just wanted to support a 2 percent COLA for the employees versus a one-time payment," Shannon said.

The group representing county employees had requested a 3 percent raise. However, most employees -- acknowledging the tough fiscal times -- had been happy to walk away with the lump payment, said Tammy McGuire, the employee group's chairwoman.

McGuire publicly offered the commissioners a "sincere thank-you" at Tuesday's hearing, saying the raise comes as "a relief to many employees."

The commissioners also received praise Tuesday night for their decision to increase education funding by $4.5 million in the coming fiscal year, the amount requested by the Board of Education.

"We'd really like to compliment you on fully funding the Board of Education this year," said Candace Sullivan, president of Calvert Crusade for Children.

Numerous people came to the hearing to pledge support for a proposal that would involve county funding of a new Boys & Girls Club in North Beach. The commissioners did not approve the last-minute request from the Boys & Girls Club of Calvert County, but they have agreed to consider such a proposal in the coming fiscal year.

The club currently operates in temporary quarters in North Beach.

"I have been going to the Bayside Club for two years," said 8-year-old Deborah Gibson, a third-grader at Beach Elementary School. "Please help build the Boys & Girls Club building in North Beach."

The commissioners' spending plan includes $158.5 million for operating expenses and $2.2 million for short-term capital improvement projects. The county's current budget totals $151.6 million, which includes $149.1 million for operating expenses and $2.6 million for short-term capital improvements.

The proposed budget calls for no increase in residents' property tax rate. The commissioners' plan, however, would increase the monthly 911 fee paid by county residents on their telephone bills from 50 cents to 75 cents. The higher fee would bring in an extra $155,000 in the next fiscal year, Shannon said.

Although the commissioners must hold a final vote on the budget, few, if any, major changes are expected, officials said.

The spending plan represents a slight increase over the budget proposal put together by staff members from county agencies at the beginning of the budget process.

For the first time since fiscal 1998, the county would not have to use reserve funds to balance the budget if the current proposal is approved, Tammy McCourt, the county's budget analyst, wrote in a memo to the commissioners. The commissioners were able to balance the budget primarily by keeping costs down, cutting some spending and benefiting from the same improving economic trends that recently eased the budget crisis confronting state government.

At the beginning of this year's budget process, county staff members estimated the revenue shortfall at $9.2 million. That number dropped by two-thirds when Calvert officials learned that the county will continue to receive a state reimbursement for revenue lost because of the deregulation of electric utilities.

Calvert Cliffs Nuclear Power Plant, the county's biggest taxpayer, pays roughly $6.1 million less each year to Calvert because of changes in the way its property is assessed under deregulation. Because of the state's fiscal difficulties, the funds to reimburse local governments for deregulation's impact on revenue were in jeopardy until the end of this year's General Assembly session.