Thursday, May 17, 2012

Council Approves FY13 Budget

Today we unanimously reached tentative agreement on a $4.6 billion total County operating budget for Fiscal Year 2013. The budget, which reflects a 5.6 percent increase over the approved budget for FY 2012, restores some of the cuts we made in recent years but still reflects our constrained circumstances. In a budget year that continues to be complicated by the national and regional economic downturn, this budget protects core services and “safety net” programs. We will formally adopt the budget on May 24, and it will go into effect on July 1.

Education continues to be our top priority, and we appropriated $2.0 billion in tax-supported funds for Montgomery County Public Schools, funding 100 percent of the Board of Education’s request and meeting the County’s Maintenance of Effort obligation. That is an increase of $50.7 million, or 2.6 percent, over FY 2012, and does not include the $27.2 million for the pension cost shift. The tax-supported budget for Montgomery College grows by $0.4 million to $218.4 million, a 0.2 percent increase, and funds 100 percent of the College’s request.

Over the last three years, the County Government workforce has been reduced by 998 positions—approximately 10 percent. The FY 2013 budget restores 92 positions, including 58 in the Police Department through increased staffing and the consolidation of 911 call-takers, and 15 in libraries.

The budget shows reductions totaling $14 million in current County Government spending. The County is expected to save $6.4 million in electricity costs as a result of newly negotiated electricity supply rates for County Government accounts.

Funding for the Maryland-National Capital Park and Planning Commission will increase by $5.4 million to $102.2 million, a 5.3 percent increase and 100 percent of the agency’s request. M-NCPPC had been hit hard by budget cuts in recent years, so I’m pleased we were able to provide this finding. We sometimes forget that our master plans are an important part of our economic development, so it is critical that we keep these updates on track for our long term future.

We approved the County Executive’s recommendation to implement an Emergency Medical Services Transport reimbursement program, which is expected to generate $18 million in annual revenue in future years. We created a dedicated account for this reimbursement revenue so that the funds will be used solely for needed improvements to the Fire and Rescue Service. This funding could be used to purchase replacement apparatus; restore Fire and Rescue services; purchase portable Fire and Rescue equipment for career and volunteer personnel; or improve and maintain Fire and Rescue facilities.

We added or restored a number of significant items related to Health and Human Services, including funds for health care for the uninsured, an increase in child care subsidies, an increase in energy assistance rebates and an increase in dental care for low-income patients. We also restored funding to restart the Conservation Corps job training program.

Economic development remained a priority for the entire Council and for me personally. We appropriated funds to partner with the Montgomery Business Development Corporation to market Montgomery County as a compelling place to conduct business and to attract and retain businesses. We created the position of Chief Innovation Officer to assist in transforming the County’s service delivery and government operations. We also added two positions to the Department of Economic Development to implement Bill 5-12 that created a Small Business Navigator to help small business owners start and maintain their businesses. I’m very pleased that even with constrained resources, we made the decision to invest in our future. Only through job creation will our residents and our county as a whole be able to achieve the future we envision.

To aid both residents and businesses, we took a significant first step in rolling back the energy tax increase, approved as an emergency measure two years ago, by reducing revenue from the 2010 tax increase by 10 percent for FY 2013.

The budget also maintains property tax revenue at the current level, which is $32.7 million below the Charter limit, and includes a $692 property tax credit for owner-occupants of principal residences. Because of declining property assessments, the weighted property tax rate will increase by 4.5 cents to 99.1 cents.

We continued our commitment to restore recent reductions to the County Libraries budget. The approved budget of $31.4 million is an increase of $2.9 million (10.3 percent from the approved FY 2012 level). We added $200,000 to the Executive’s recommendation to increase purchases of library materials.

The budget includes funding for all the economic provisions in the negotiated collective bargaining agreements with County employees represented by the Fraternal Order of Police, the International Association of Fire Fighters, and the Municipal and County Government Employees Organization. The budget includes funding for most County employees to receive a $2,000 one-time lump sum payment that will not increase the employee’s base salary. The budget also includes funds to reinstate longevity raises for eligible long-time County employees and to reinstate limited tuition assistance for all County employees. Our employees really have been great throughout the economic downturn, and I’m glad that we finally are able to provide some measure of increased compensation this year. It is certainly overdue and well deserved.

M-NCPPC is taking the same one-time lump sum approach. Montgomery College provided a one-time lump sum payment to its employees in FY 2012 and will not be making a payment in FY 2013. MCPS plans to provide increases to base pay.

The budget maintains the County’s commitment to prudent fiscal policies that the Council and Executive mutually agreed are critical to maintaining sound fiscal management. The budget increases County reserve levels to $302 million to cushion the County against any additional unanticipated economic setbacks. It also more than doubles the pre-funding of retiree health benefits.

The County’s Capital Improvements Program (CIP) that is the focus of major review every two years was updated for Fiscal Years 2013-18. The plan includes funding of $4.3 billion. The six-year CIP for all agencies (excluding the Washington Suburban Sanitary Commission) addresses major projects.

Among the notable items funded in the CIP is approval for the Wheaton Redevelopment Program that will guide revitalization of Wheaton’s downtown area. We also restored funding for the Bethesda South Metro entrance to demonstrate its commitment to the Purple Line, and included funds for the Capital Crescent Trail. Traffic projects that continue the implementation of the White Flint Sector Plan also remain funded and on schedule. Planning for a proposed County-wide rapid transit system continues.

The CIP also includes funding for sciences and student services buildings and a new parking garage at Montgomery College; a long-awaited North Potomac Recreation Center; and critical pieces of bike infrastructure, such as the Metropolitan Branch Trail.

The CIP for Montgomery Public Schools includes funding for 20 new schools and/or additions, including nine projects new to the CIP.

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