By Adam Pagnucco.
Battered by tax-shocked residents, county employee unions and the legions of people who regularly demand funding for their favored spending, the county council is trying to navigate a middle path that will leave no one happy but hopefully no one outraged. It’s a rocky road to be sure, and today, we began to see some evidence of how the council is doing.
That evidence is contained in the release of the first iteration of the council’s reconciliation list, which is its tool for changing executive budgets. Traditionally, the reconciliation list (referred to inside the council building as the “rec list”) is a ledger of increases and reductions to spending and revenues. In prior years, it always contained additions totaling in the millions of dollars. But the rec list was never fully funded because council staff could not locate enough pennies under the couch for every want. So the final net addition was usually in the range of $10-25 million.
This year, with a $223 million property tax hike on the table, the rec list’s procedures have been changed in two important ways. First, the executive’s recommended increases are now on the rec list. There is no assumption that they will be passed – rather, they now have to compete with the council’s proposed additions. Second, the council is now categorizing spending additions as either “high priority” or “priority.” This includes the executive’s increases. That provides a hint as to which items are more likely to be funded.
At this point in time, the council’s committees have added many items to the rec list, both spending and reductions. These are recommendations, meaning that they have not yet been decided by the full council. Indeed, the full council could add more spending items or reductions. And crucially, the full pot of money available for funding is not yet clear because the council has not yet set the property tax rate. So this is just a snapshot of a work in progress.
That said, here are the basics so far.
Council committees have recommended cutting $29 million from the executive’s budget.
The biggest single cut is the Education and Culture Committee’s reduction of $22 million from the executive’s request for MCPS, an act bitterly opposed by MCEA and SEIU Local 500. These reductions are equivalent to 1.3 pennies of the executive’s 10 cent property tax hike.
Council committees have placed $58 million of the executive’s increases on the rec list as “priority” items.
Let’s remember that spending items on the rec list are divided into “high priority” and “priority.” My sources are skeptical that money will be available to fund many, if any, priority items. $45 million of this spending is accounted for by MCPS, which again stokes outrage from its employee unions. These items are equivalent to 2.6 pennies of the executive’s 10 cent property tax hike.
Council committees have placed $9.2 million of high priority spending and $6.5 million of priority spending on the rec list.
This is new spending that the council would like to fund. Let’s bear in mind that the priority spending is less likely to pass than the high priority spending. The high priority spending is equivalent to 0.4 pennies of property tax and the priority spending is equivalent to 0.3 pennies.
The vacancies issue has not been fully addressed.
Council committees have recommended lapse savings for a smattering of individual positions but there does not appear to be a comprehensive approach to the issue of defunding vacancies. Even the county executive concedes that there could be millions more in potential savings on this issue alone.
At this early stage, potential scenarios can be charted out. Here’s one. Suppose the council sticks with their committees’ cuts, does not fund the $58 million in priority executive spending, does not fund their own $6.5 million in priority spending and does fund their $9.2 million in high priority spending. That would net 3.5 cents in savings on the property tax, which if subtracted from the executive’s 10 cent increase would be a 6.5 cent property tax hike.
That would probably make both the unions and many taxpayers equally unhappy. On tough budgets, such outcomes are often the result!