The Charles County Commissioners received discouraging news from county government’s Department of Fiscal and Administrative Services (F&AS) Tuesday, April 26 regarding the proposed fiscal year (FY) 2012 Operating Budget. The spending plan’s projected revenues fall nearly $7 million short of funding county government’s planned $306.8 million in expenditures.
“We’re at a baseline level,” said F&AS Director Deborah Hudson, who explained county staff has reached a point where it cannot sustain many more funding reductions without cutting services. “We’ve tried to turn over every rock and stone. This year’s deficit of $7 million will be particularly difficult to resolve.”
Hudson told the board they would need to make some “difficult decisions” in order to balance the FY 2012 Budget.
Hudson noted that during FY 2008, Charles County Government had nearly 900 funded positions. The current budget funds 641 positions.
According to F&AS budget analyst David Eicholtz, Charles County’s property tax revenues continue to decline due to lower assessments. A 2 percent decline in property tax revenues is forecast for FY 2012, said Eicholtz.The property tax receipts represent 61 percent of the county’s revenue. The county’s property tax rate has remained at $.962 per $100 of assessed value with an additional $.06 levied to fund emergency services, making the actual rate $1.02 per $100 of assessed property value.
Eicholtz reported the county’s second-largest revenue stream, income tax receipts, is projected to increase in FY 2012 by 3.6 percent. Income tax receipts comprise 30 percent of Charles’ revenue picture.
Eicholtz stated that $145.6 million is budgeted for the Board of Education. That amount represents around 47 percent of the total operating budget and would fulfill the county’s state-mandated maintenance of effort requirement.
“The Board of Education is recommended to be fully funded,” said Hudson, who added the school board has not yet submitted its budget request to F&AS.
Charles County’s public safety entities are recommended to receive increases in the next fiscal year. The county’s primary law enforcement agency, the sheriff’s office is recommended to receive a 3.5 percent funding increase. Hudson explained the increase is needed to cover pension costs, salary scale, training costs and to restore funding that was cut during the two previous fiscal years. The sheriff’s office funding represents 21 percent of the operating budget.
According to F&AS staff, other factors driving budget revenues down include severe cuts in state funding, particularly highway user fees; plus increased costs in fuel, electricity and health insurance. Additionally, recordation revenues, which Eicholtz said peaked in FY 2006, continue to decline steadily.
We have seen the effects of the great recession,” said Hudson. “At some point the economy will heal.”
A public hearing on the proposed FY 2012 Budget is scheduled for May 25.
