Six-Year Balanced Fiscal Plan and Reserve Policy

We signed off on a six-year balanced fiscal plan which I recommended in April. We also enacted a new reserve policy that will take us to a 10 percent reserve in nine years.

Although the County Charter does reference it, this is the first time the Council has instituted a six-year projection designed to reduce annual budget gaps and lessen the impact of severe economic downturns. The plan will not constrain future Councils in their year-to-year decision making, but it will provide valuable information and guidance for sustainability over the long term. The plan not only will guide Councilmembers but also will give 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. The plan will be updated annually as conditions change. I see it as a great tool for everyone.

Under the new reserve policy, we will gradually increase our reserve to 10 percent of adjusted governmental revenue over a nine-year period. The current reserve target is 6 percent of total resources. We will have to be very thoughtful about spending to meet our goals, but this plan will put us on more solid footing for future economic downturns. It is important to note that a 10 percent reserve is fairly modest according to our financial advisers who recommend a reserve equivalent to 60 days of operating expenses.

In April the bond rating agency Moody's placed the County on "watchlist negative." Moody's listed both our recent history of structural deficits and our low reserve fund policy as factors in the warning. We covet our AAA bond rating, which reflects the County's excellent financial management over time. Maintaining the top-notch rating allows us to borrow at a low interest rate, which means we can invest in infrastructure at a lower cost.

This is a new era in Montgomery County, and it means we're going to have to be more disciplined. This comprehensive fiscal management package is a big step in the right direction.

Fireworks

Montgomery County will again this year host two Independence Day fireworks displays on Sunday, July 4. Germantown Glory will be held at the SoccerPlex in the South Germantown Recreational Park, 18041 Central Park Circle. Mid-County Sparkles will be held at Albert Einstein High School, 11135 Newport Road, Kensington.

Germantown Glory
A concert by Bobby and the Believers will begin at 7 p.m., with fireworks at approximately 9:30 p.m. Blankets, chairs and picnics are welcome. No alcohol is permitted. Food vendors will be on site. Rain date for the fireworks only is July 5.

To reach the South Germantown Recreational Park from I-270, take exit 15B (Route 118 south) toward Germantown; go for 2.8 miles and turn right onto Richter Farm Road. Go one mile and turn left onto Schaeffer Road. The park entrance is 0.3 miles on the right.
For more information about Germantown Glory, call the Recreation Department at 240-777-6820.

Mid-County Sparkles
Pre-fireworks activities will include children’s activities and a musical concert with Groove Killers beginning at 7:30 p.m. The fireworks will begin at approximately 9:15 p.m. The viewing areas will be at the front of the school on the ball field and at the Newport Mill Middle School, 11311 Newport Mill Road. Since there will be no on-site parking at either school or at adjacent properties, except for handicapped parking, shuttle buses will pick up passengers, beginning at 6:15 p.m., at Westfield Wheaton and the Wheaton Metro Station.

Low lawn chairs and coolers are welcome. Food vendors will be on site. No alcoholic beverages are permitted. Rain date for the fireworks only is July 5. No shuttle service will be available on the 5th.

For more information on the Mid-County Sparkles celebration, call the Mid-County Regional Services Center events line at 240-777-8115.

Holiday Schedule for Fourth of July

Here is the County's holiday schedule for Independence Day on Monday, July 5:

• County Offices -- closed
• Libraries -- closed
• County liquor stores – open from 11 a.m. to 7 p.m. with the exception of the following stores, which will be closed: Cabin John, Diamond Square and Burtonsville
• Ride On – Saturday schedule
• Metrobus – Saturday schedule on Sunday, July 4; and Sunday schedule on Monday, July 5
• Metrorail – Special schedule on Sunday, July 4 and Sunday schedule on Monday, July 5
• Parking at public garages, lots, curbside meters – free
• Refuse/recycling pick-up – no collection*
• Transfer Station – closed
• MCPS Administrative Offices – closed
• State offices & courts – closed

*collection provided one day later for remainder of week (last collection day is Saturday)

Appearing on Political Pulse

Tune in to Political Pulse on Montgomery Municipal Cable (channel 16) this week. I will join host Charles Duffy and at-large candidate Jane de Winter to discuss Montgomery County’s future. The show will air on:

Thursday, June 24 at 9:00, p.m.
Friday-Sunday, June 25-27, at 6:00 p.m.
Tuesday, June 29 at 9:30 p.m.

Appearing at the American Highway Users Alliance

Tomorrow I will participate in a panel discussion titled “The Surface Transportation Authorization Bill: Consequences of Current Failures and Opportunities to Change the Dynamic” at the American Highway Users Alliance Quarterly Meeting in Washington, DC.

I will join panelists from the Maryland Department of Transportation and the U.S. Senate Environment and Public Works Committee. Our discussion will focus on the stalled bill’s importance to local governments, particularly as it affects planning, programming and the ability of counties to respond to transportation needs. We need all hands on deck to move our transportation agenda forward. Federal, state and local governments must work together, and I’m glad to be a part of these important conversations.

Several projects in Montgomery County which are planned to be constructed by the Maryland Department of Transportation cannot proceed to construction due to lack of funding. They include the Purple Line; the Corridor Cities Transitway; the widening of the western portion of the Beltway over the American Legion Bridge; and the addition of reversible high occupancy toll (HOT) lanes on I-270. This year the Council decided to use local dollars to fund one such project—a $60 million segment of the Montrose Parkway.

In addition to chairing the Council’s Transportation, Infrastructure, Energy and Environment Committee, I also serve as Vice-Chair for Transit for the National Association of Counties’ Transportation Steering Committee.

Olney Manor Dog Park Opens Saturday

Join Lady (my schnoodle) and me for the grand opening of the Olney Manor Dog Park tomorrow, 9:00-noon. This is the fifth dog park in the county’s system, joining Black Hill Regional Park, Cabin John Regional Park, Ridge Road Recreational Park and Wheaton Regional Park. Parks staff tell me that dog parks continue to be one of the most popular amenities in the parks system. And I know Lady is looking forward to getting a treat from Bark!, one of the local businesses participating in the event.

Town Hall Meeting Wednesday

Join us for a daytime Town Hall Meeting this Wednesday, June 16, in the Leisure World Social Hall at 2 p.m. This is your opportunity to voice opinions on specific issues and ask us questions in an organized, but informal, setting.

Topics expected to be of interest include the public safety, traffic, growth, the County budget, health programs and taxes—including the recently increased energy tax.

We recently approved the Fiscal Year 2011 budget that required closing a shortfall of almost $1 billion due to decreasing revenues. We made some very difficult decisions that will impact every resident of this County. This meeting will allow us to hear about your priorities and concerns. And it also gives us the opportunity to explain some of the issues that are before us.

This Council has made a priority of having better direct communication with residents, and Town Hall Meetings have proven to be an excellent way to do just that. For residents, these meetings provide a forum where they can see their elected officials in a different format than a televised meeting or through a news release.

The meeting will be taped for later broadcast on County Cable Montgomery (CCM—cable Channel 6 on Comcast and RCN, Channel 30 on Verizon). Leisure World is located at 3700 Rossmoor Blvd. in Silver Spring. Non-residents of the community must check in at the security gate before proceeding to the Town Hall Meeting.

For more information about the Town Hall Meeting or about the broadcast times, call 240-777-7931.

First Segment ICC Tolls Set

The Maryland Transportation Authority just let us know its toll schedule for the first 5.65-mile segment of the Intercounty Connector (ICC), and I am pleased that they listened to us and chose the lowest level cost to drivers. The first segment will run from I-370 at Shady Grove to Georgia Avenue near Rockville/Olney.

When the segment opens in late 2010/early 2011, drivers of cars and light trucks will pay $1.45 during peak hours, $1.15 during off-peak times and $0.60 during the overnight period. To learn more, visit the Maryland Transportation Authority’s Web site.

Summer Food Safety

Our public health officer tells us that more than half of the cases of salmonella each year occur during the summer months. While not fatal, this type of food poisoning usually occurs 12 to 36 hours after eating contaminated food. Symptoms include headache, nausea and vomiting, abdominal pain, diarrhea and fever.

Dr. Tillman tells us that foods likely to contain bacteria when undercooked include eggs, meat, poultry, fish and cooked high-protein foods that have not been refrigerated after cooking, such as rice, potatoes and beans.

The following tips will help residents enjoy the summer after the social gathering has ended:

Cook foods to at least 145°F, pork to at least 155-160° F, ground beef to 155-160° F, poultry to 165° F, stuffing and stuffed meat to at least 165° F. Hot foods should always be served while still hot.
• Cook hamburger patties and meat loaf so the center is NOT pink and the juices run clear. Crumbled ground meat should be cooked until no pink color remains.
• Keep hot foods hot. After cooking meat or chicken on the grill, keep it at 135°F or warmer until serving. If reheating fully cooked items such as baked beans or hot potato salad, heat to 165°F.
• Keep cold foods cold. If using a cooler, keep it out of the sun and avoid opening it too often so it stays as cold as possible. Keep cold foods at 41° F or colder at all times.
• Transport cold foods in a cooler to minimize bacteria growth. Use an insulated cooler with ice packs.
• When making cold salads and sandwiches—or any food served cold—refrigerate all ingredients (below 41° F) before mixing, and then return to the refrigerator until served.
• Thoroughly clean and sanitize utensils and cutting surfaces between the preparation of different food items, especially after handling raw poultry, beef, pork and eggs. These raw foods have surface bacteria that could contaminate other foods. Never put cooked meat on the same unwashed platter used for raw meat.
• Do not buy or use cracked eggs.
• Do not thaw meat and poultry at room temperature. To keep the outside of these foods cold while the inside is still defrosting, thaw them overnight in the refrigerator or under cold running water. Microwave ovens can be used to safely defrost meat and poultry, but cook immediately.
• Promptly refrigerate leftovers. Store food in shallow uncovered containers to cool rapidly.
• Reheat leftovers thoroughly (165° F or more) before serving.
• Wash hands with soap and water before preparing food, after handling raw food and after using the bathroom or playing with pets.
• Prepare food as close to serving time as possible. This eliminates the time element that can allow any bacteria that may be present to increase to large numbers. Food should be left out no longer than two hours. If the temperature is 90° F or warmer, food should not be left out longer than one hour.
• Finally, when in doubt, throw it out.
For more information about safe food preparation and handling, call the United States Department of Agriculture’s meat and poultry hotline at 1-888-674-6854 or go to http://www.fsis.usda.gov/food_safety_education/USDA_Meat_&_Poultry_Hotline/index.asp.

Refurbished Properties Now Affordable Rentals

Today I had the opportunity tour a formerly vacant foreclosed property that is now available for rental through the Housing Opportunities Commission. The acquisition and renovation of the house, as well as 15 others in Germantown and Wheaton, is part of a $7.1 million effort made possible by funding from the U.S. Department of Housing and Urban Development’s Neighborhood Stabilization Program, the Maryland Department of Housing and Community Development’s Neighborhood Conservation Initiative and a HUD Community Development Block Grant. This program is a real win-win. It is good not just for families in need of affordable housing, but for neighborhoods and the county as a whole. I’m glad we’ve been able to work with our state and federal partners to make this program happen.

The Budget--What's In and What's Out

In an austere year caused by the deep recession, we approved a $4.3 billion total County operating budget for Fiscal Year 2011, which begins July 1. The total budget is 4.5 percent less than the approved budget for FY10, marking the first decrease in a total budget since the adoption of the current County Charter in 1968.

The overall tax-supported budget of $3.66 billion reflects a decrease of $191 million from the FY10 adopted budget, a decrease of 5 percent. This is the second consecutive year the tax-supported portion of the budget has decreased. Since March 15, when the County Executive presented his recommended budget, we have worked to achieve equity in the allocation of limited funds. One way we did this was to reduce spending for Montgomery County Public Schools (MCPS) by $24.4 million, 1.1 percent less than proposed by the Executive. These funds will be used to mitigate deep cuts in the safety net and other vital services, including Montgomery College.

In a budget year complicated by the national and regional economic downturn, our budget protects core services and programs for the most vulnerable, but does not exceed the County's Charter Limit on property tax revenue. The budget includes a $692 property tax credit for owner-occupants of principal residences. It freezes pay for employees of County government, Montgomery College, the Maryland-National Capital Park and Planning Commission (M-NCPPC) and MCPS.

Employees at all agencies except MCPS will be asked to take unpaid furlough days in FY11. Furloughs for County Government employees, including elected officials, will be progressive: three days for employees whose salaries are less than $50,000; five days for those with salaries of $50,000 to $100,000; and eight days for those with salaries greater than $100,000.

The budget includes a plan to consolidate recreation facility and athletic field permitting, class/program registration and additional recreation programs into County Government from the Department of Parks to create a more streamlined and user-friendly system for County residents. The Council believes this consolidation, over time, will lead to budget savings and operational efficiencies.

The budget re-establishes the reserve at 6 percent, which should help maintain the County's AAA bond rating. The reserve had been reduced to 5 percent in FY10.

On the revenue side, although we chose not to exceed the Charter Limit on property tax this year, some other taxes and fees will go up. The energy tax will increase by 85 percent with the increase split between residential and commercial users, and the tax on wireless phones will increase from $2 to $3.50 per month. In this difficult budget year, we are all in this together.

Despite a record drop in revenue, we have worked to develop a budget that is fair--fair to our residents who rely on County services, fair to taxpayers and fair to employees. In allocating sharply reduced resources, we have given top priority to our school children--the MCPS share of total agency spending is 57 percent, up from 55 percent in FY10 and over the last decade--as well as Montgomery College, public safety and the safety net.

For more details, see the press release

County Gets Maintenance of Effort Waiver

The Maryland State Board of Education granted us a waiver of the State’s Maintenance of Effort law for Fiscal Year 2011. The law requires jurisdictions to appropriate at least as much money per pupil to its public schools as it did in the previous year.

Earlier in the day, I, along with Ike Leggett, Jerry Weast and Pat O’Neill presented a united front in requesting the waiver before the State Board.

We thank the State Board of Education for today’s decision that, in essence, recognizes the commitment Montgomery County has historically made to its educational system and also recognizes the drastic budget situation that has impacted our County over the past several years due to a variety of circumstances. No county in this state—in fact, few counties in this nation—have made as great of a financial commitment to education over past decades as has Montgomery County. That commitment will never be altered, and even in this most austere of years, more than 56 percent of our total combined agency expenditures will go to our public schools. We are pleased the State Board of Education has made a decision that is the right one for the children of Montgomery County.

Holiday Schedule for Memorial Day

We will observe the following holiday schedule for Memorial Day on Monday, May 31:

County Offices - closed
Libraries - closed
County liquor stores – open from 10 a.m. to 6 p.m. with the exception of the following stores, which will be closed: Cabin John, Diamond Square and Twinbrook
Ride On – Sunday schedule
Metrobus – Sunday schedule
Metrorail – Sunday schedule
Parking at public garages, lots, curbside meters – free
Refuse/recycling pick-up – no collection*
Transfer Station – closed
MCPS Administrative Offices – closed
State offices & courts – closed

*collection provided one day later for remainder of week (last collection day is Saturday)

My Thoughts on the Budget

Today we reached a tentative agreement on the Fiscal Year 2011 Operating Budget. Here are my thoughts:

This has been an extraordinary and unprecedented fiscal experience, due, in large part, to the 21 percent decline in income tax revenue, and a historic increase in unemployment. We are closing a fiscal gap that in the short span of six months went from about $600 million to nearly $1 billion.

For the current fiscal year, before we could even get into the FY11 budget, this council approved two savings plans totaling $100 million, and yesterday approved energy tax increases that will add $21 million in additional revenue to see us through to July.
This budget has been a moving target, and we have responded nimbly. Today, we have taken actions that address, not just to the County Executive’s March 15 budget proposal, but the reactions of the Rating Agencies we received immediately thereafter, and further revenue writedowns in revenue we were presented with in late April.

We have moved steadily and in unison, driven by our collective commitment to four basic principles – fairness to taxpayers, equitable treatment of employees, commitment to the goal of a 6 percent reserve and a balanced fiscal plan.
This budget achieves those goals.

We are reducing overall spending by 4.5 percent, for the first time in recorded Montgomery County history. We preserve our highest priority services, especially in education, public safety and service to our most vulnerable. Since to go any further would devastate these critical services to our residents, we have focused on the fairest way to ask our taxpayers to share the burden. We chose not to exceed the Charter Limit on property taxes this year and instead focused on revenue sources with widest range possible – a rebalanced and reduced energy tax from the County Executive’s proposal, a modest boost to the cell phone tax and the ambulance fee.

We have resisted the pressures to rush to judgment, to choose sides, or to take an adversarial position. Instead we have listened thoughtfully and carefully, and we have balanced extraordinarily valid competing goals and priorities. I want to thank my fellow Councilmembers for your commitment to to making the difficult (and in many cases unpopular) decisions that are in the best interest of the County. Everyone has proceeded with integrity and respect as we have worked through some of the most difficult choices any Council sitting on this dais has ever had to face.

Not a one of us has shied away from a single hard decision. In our worksessions we have made our best efforts to find cost effective consolidation of programs through the regional services centers and office of community partnerships, through the operations of the parks and county police, and through the coordination of services provided by the Department of Recreation and the Department of Parks. We have heard employees concerns about management levels and have investigated their issues. We have worried about the fairest way to share employee pain in reduced salaries and have extended furloughs progressively and comprehensively across the widest range of employee groups, including fire and police, within our control. We have asked for additional cooperation from the public school system and they have partnered with us in finding further reductions in their spending that do not affect our commitment to the classroom or educational excellence.

Next month we will be taking up the balanced fiscal plan that results from these budget decisions as well as the County Executive’s Reserve and Selective Fiscal Policies proposal that, together, will set the parameters of our fiscal future.
And we are not done. We have this week committed to further work on governmental consolidation possibilities, and fiscal structural deficit analysis.

That means we will be leaner for the foreseeable future. In spite of this year’s difficulties, I am entirely optimistic about Montgomery County’s future thanks in part to the forethought and wisdom reflected in this very disciplined budget. Moreover, in just the past two months, we have taken significant steps to expand the County’s tax base.
We have unanimously approved two master plans, approved a bio-tech tax credit, and will soon be establishing the Montgomery Business Development Corporation to advance job creation.

Certainly, today is not a day for celebration. We are acutely aware of the real and personal impacts this budget will have on residents and employees. But we can feel good about the fact that we are on the right track, that we will benefit from a new way of doing business, and that the values that make Montgomery County great are here to stay. It is a new era in Montgomery County, and our future looks bright.

Council Highlights for Thursday, May 20

We made good progress today. Here are the highlights for tomorrow (the big day) from our Legislative Information Office:

The Council is now scheduled to reach a tentative agreement on the budget in a session that begins at 1:30 p.m. on Thursday, May 20. The Council is scheduled to formally adopt the budget on Thursday, May 27. The Council will meet tomorrow on the budget agreement in the Third Floor Hearing Room of the Council Office Building at 100 Maryland Ave. in Rockville. The meeting will be televised live by County Cable Montgomery (CCM—Cable Channel 6 on Comcast and RCN, Channel 30 on Verizon) and also will be available via streaming video through the County Web site at www.montgomerycountymd.gov.