New budget is in the red

March 08, 2000|By SCOTT BUTKI

The Washington County Commissioners got their first look Tuesday at the proposed fiscal 2001 general fund budget, which lists a nearly $6 million shortfall.

The commissioners spent almost five hours discussing and poring through the 360-page budget but have not begun to determine whether they will make cuts or raise taxes to balance the budget.

While the federal and state governments had surpluses this year, many Maryland counties, including Washington County, must decide whether to make budget cuts, raise taxes or both, County Administrator Rodney Shoop said.

Included in the budget book was a copy of a newspaper article that said Howard, Carroll, Queen Anne's, Frederick and Charles counties may need to raise taxes and fees to deal with shortfalls.


Balancing the budget is "probably going to be a combination of cuts and increases in revenues, either through fees or tax increases," Commissioners Bert L. Iseminger said.

Commissioner Paul L. Swartz said if the county has to raise taxes, his preference would be to increase the piggyback tax rate, which is now 50 percent.

The budget includes a proposed new tax, a 1 percent transfer tax, which would bring in an estimated $1.2 million for county projects. About $600,000 would go to the School Board, $250,000 for urban revitalization and the rest to other projects, Budget and Finance Director Debra Bastian said.

The tax would be imposed on some real property transactions, County Attorney Richard Douglas said. The county does not have the tax but has state authority to levy it, he said.

The tax would be in addition to a 1/2 percent transfer tax imposed by the state government.

The present draft of the general fund projects $118.87 million in revenue, a 4 percent increase over the $114.2 million budgeted this fiscal year that began July 1.

But the budget includes $124.73 million in general fund expenses, resulting in a shortfall of $5.86 million. Expenses have been pared down from $126.64 million in general fund budget requests, Bastian said.

The budget gives the School Board full funding for operating expenses of $66.2 million, a 10.77 percent increase over the current budget year, according to budget documents.

The budget does not include money from a proposed hotel-motel tax increase because the Maryland General Assembly has not yet approved the hike.

The county has given the Washington County Water and Sewer Department about $12 million in subsidies since taking over the Washington County Sanitary District in 1994.

This year, the county subsidy was $2.65 million: $350,000 to the water fund, $1.95 million to the sewer fund and $350,000 to the pretreatment fund.

The budget proposal calls for decreasing the amount to $2.54 million by decreasing the water fund amount from $350,000 to $240,000.

The subsidy amounts and the size of proposed water and sewer rate increases are to be discussed in more detail at the County Commissioners' March 21 meeting.

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