Baltimore residents would have to pay more to grab a cab. They would be hit with an additional fee in their water bills. And they would have 300 fewer firefighters on the payroll.
But they also would have lower property taxes, better recreation centers and fewer potholes.
Those are some of the "tough trade-offs" Mayor Stephanie Rawlings-Blake proposed Wednesday under a budget plan that also includes major cutbacks in pension and health care benefits to help close a $30 million projected budget shortfall. In another trade-off for city workers, her budget includes 2 percent cost-of-living raises.
Rawlings-Blake said she crafted the proposal with an eye toward making the city a more attractive place to live. "The budget was built in the spirit of growing the city by 10,000 families," she said.
But she'll face opposition from some City Council members, union members and industry groups. Both City Council President Bernard C. "Jack" Young and Vice President Edward L. Reisinger said not all of the council members are on board with all of the proposals — most of which have not yet been introduced.
"I don't think all the council people are there yet," Young said. "We have to see the details."
Six pieces of City Council legislation are needed to make the plan a reality: two concerning pension overhauls and four concerning new taxes and fees. The mayor must win City Council approval of that legislation by July, when the new fiscal year begins.
"This plan is only possible if the city implements a series of changes," said the city budget director, Andrew W. Kleine.
The $2.4 billion budget proposal represents about a 3 percent increase in operating expenses from the current fiscal year. The mayor is also proposing a capital budget of about $1.2 billion, 80 percent of which would go toward updating, maintaining and repairing water and wastewater infrastructure.
The mayor would increase spending by allocating $10 million for demolishing vacant homes, $10 million for resurfacing at least 200 miles of roads and $6.5 million to upgrade and operate recreation and after-school centers.
Among the new taxes and fees are plans to charge more for billboards, taxi trips and stormwater services.
Under the proposal, the city would charge 25 cents per taxi trip and a tax of about 7 percent per billboard. The state-mandated stormwater fee would cost the average city resident about $48 a year, and larger property owners and businesses would pay more, Kleine said. The city expects to take in about $12 million next fiscal year from the fee, he said. Voters authorized a new stormwater utility in November.
Reisinger said he opposes the mayor's proposal to tax area billboards. Clear Channel Outdoor, which maintains many of Baltimore's billboards, has worked well with the city and agreed to post public service announcements, he said. Past efforts to tax billboards have failed.
"I'm not going to support a billboard tax," said Reisinger, who is the mayor's traditional champion of legislation in the council. "I'm not going to rubber-stamp anything."
The budget is Rawlings-Blake's first opportunity to implement the initial steps of a 10-year financial plan she says is needed to fix a $750 million structural deficit that the city is facing over the next 10 years. The $30 million shortfall would be covered largely through the cuts to pension and health care benefits and a new stormwater fee, according to Kleine.
Rawlings-Blake called last month for "bold reforms" to fix the looming financial shortfall, including requiring more city workers to contribute to their retirement fund, charging residents for trash collection, asking firefighters to work longer hours and cutting the city workforce by 10 percent over time.
In return, she said, the city could use the savings to raise employee salaries and cut property taxes by 22 percent — 50 cents per $100 of assessed value — over the next decade. In the next fiscal year, the mayor has proposed cutting the rate by 2 cents per $100 of assessed value, with some homeowners eligible for bigger breaks.
The long-term projections are based on a consultant's report, for which the city paid $585,000, that details a long-term financial shortfall and offers recommendations for saving money.
The trash fee is not included in the budget proposed Wednesday, but the proposal does target employee pension costs. Kleine said the city is facing $192 million in such costs next fiscal year.
"The growth of these costs is relentless," he said.
Under her proposal, the city would start requiring civilian employees to contribute 5 percent of their salaries to their pensions, Rawlings-Blake said. The city would phase in the contribution increases, starting at 1 percent in the coming fiscal year. New employees would be given 401(k)-style plans instead of traditional pensions. The changes to city pensions would save $5 million in the coming fiscal year, Kleine said.
The budget also includes a new shift schedule for firefighters, requiring department employees to work longer hours. The city expects about 300 fire department positions to be cut through attrition as a result of each employee working for 24 hours straight and then taking 48 hours off.
Rick Hoffman, president of the firefighters union, released a statement opposing the mayor's plan.
"As a union leader I cannot support a plan that eliminates jobs," Hoffman said in an email. "An overwhelming amount of our membership — nearly 90 percent — voted to turn down the City's best offer and now we will either continue talks with the City or proceed with the arbitration process."
Kleine said the budget does not include any reductions from automatic federal budget cuts known as sequestration. Such cuts could be devastating to Baltimore, Kleine said.
"There is no wiggle room," he said. "That's the sad fact. If we receive cuts in our federal grants, services will be lost."
Even if there's a fight over the details, council members said they understood the importance of curbing Baltimore's projected deficits.
"If we don't do anything about our structural deficit, we could end up like Detroit and other places," Young said. "I don't think anybody wants to see that."
Reisinger emphasized the need for the council to act quickly with the mayor's legislation.
"It's a must," he said. "We've got to make time for it."
Kleine presented the budget to the city's Board of Estimates Wednesday morning. Also that day, City Auditor Robert L. McCarty told the board the city had to spend more than $1 million to rework audit reports that contained erroneous information. Comptroller Joan M. Pratt said the city could have saved money if the Finance Department had listened earlier to city auditors' concerns about inaccurate books.
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