Tuesday, September 28, 2010

County's Economic Outlook Remains Flat

Although experts have declared the recession over, economic indicators in Montgomery County (like other parts of the country) remain flat, according to Tuesday’s briefing on our financial outlook. Unemployment in the County is currently at 5.5 percent, well below the national average but above our November 2007 rate of 2.5 percent.

This, along with other indicators like home sales, inflation and the stock market, means governmental revenues will remain weak for the next fiscal year. Right now, the County’s major known commitments for FY12 are projected to increase by 4.3 percent. However, the fiscal plan we approved in June permits growth in expenditures of only 0.1 percent. In other words, there is a lot to think about as agencies, the County Executive and we at the County Council move through the budget this year.

It is still early in the process, and a lot can change. We will get more accurate revenue numbers in November. Then in December, we will get a report from the Office of Legislative Oversight on the County’s structural deficit as well as recommendations from the Cross Agency Resource Sharing Committee. In January, we will get the final report from the Organizational Reform Commission. The County Executive will send us his proposed budget by March 15, and we will pass a final budget at the end of May.

Essentially, Montgomery County remains fiscally strong, and we will continue to provide the services that constituents expect, including top-notch education, public safety and programs for the most vulnerable. But this is a new era, and we are going to have to be more disciplined for the foreseeable future. Achieving that balance will be the topic of much discussion over the next eight months.

No comments: