Budget: Next Year Will Be Bigger Challenge

Last year's fiscal plan projected a very small 0.1 percent increase in funds available for agencies in FY12. The actual number turned out to be very close at 1.4 percent (the inflation rate for 2010 was 1.7 percent). That was valuable information for us to have last June, and we planned accordingly. This year’s projection for FY13 shows a decrease of 2.7 percent, and that means we need all hands on deck. It means that next year looks even more challenging than this year.

We approved our second annual fiscal plan last week. We started requiring a six-year balanced fiscal plan at my urging last year when I was Council President as a way of addressing our structural deficit. While the plan does not constrain future Councils in their year-to-year decision making, it provides valuable information and guidance for sustainability over the long term. The plan gives communities and the County's four agencies--Montgomery County Public Schools, Montgomery College, the Maryland-National Capital Park and Planning Commission, and County Government--a realistic view of what they can expect in the upcoming years.

This year's plan makes clear what we already know intuitively--that absent a far more robust economic recovery than has occurred to date, we are facing limited resources for FY13 and beyond. Current projections for FY13 showing a decrease of 2.7 percent in funds (nearly $100 million) available for agency expenditures mean we again are going to have to work together to make difficult decisions. Future years show very modest increases of 2.2 percent, 3.4 percent, 4.8 percent and 3.6 percent.

FY12 began on July 1, 2011, and budget deliberations for FY13 will begin on March 15, 2012, when the County Executive transmits his proposed budget to the Council.