A citizens advisory panel is expected to report today that county taxpayers can afford to support a $638 million operating budget next year.

But the committee might prove to have more influence on issuesthat it didn't have time to debate.

The Spending Affordability Committee voters created last year will advise setting three separate limits on general spending, debt service and pay-as-you-go capital projects, according to a draft report released yesterday.

Despite the recession, the panel concluded thattotal personal income in Anne Arundel County would allow the budget to grow more than $21 million above the $617 million budget for fiscal 1991, which ends June 30.

Although that is significantly below the rate of growth under former County Executive O. James Lighthizer, his successor expects to produce a much smaller budget in May.

"Unfortunately, the spending caps will not be relevant," County Executive Robert R. Neall said Wednesday at a seminar on the recession sponsored by the Anne Arundel Trade Council. "It's important that government takes no more than its fair share out of the economy."

Because revenues are shrinking, that fair share could be as low as $605 million, Neall said Monday.

The panel's recommendation to impose limits on the three categories of spending could lower property taxes over time by ending the use of planned surpluses.

The cap on general appropriations follows a 10-year trend of spending in relation to total personal income.

Consistent with Neall's campaign pledge, the limit would allow county spending to climb at a rate slightly less than the growth in taxpayers' income. Over time, that would lower the tax burden.

The panel also recommended that money used to pay off loansand interest be limited to 7.08 percent of total operating revenues.This limit is slightly higher than in recent years to allow spendingflexibility during the recession.

The most important change in policy could come through limits on paying up front for expensive capital projects. Under Lighthizer, the county began using surpluses to build office buildings, roads and other expensive projects.

By 1990, pay-as-you-go spending climbed to 4.7 percent of the budget. The panel advises that a limit of 1.61 percent be imposed next year.

Without specifying a limit, Neall said Monday that he supports such a change in county policy and plans to introduce a bill restricting use ofsurpluses in May.

The spending committee serves only as an advisory body to Neall and the County Council, and county Controller Joseph Burrows told its members last month that he never read the report ofa similar group created last year by the council.

But the new committee could change the way the county does business, even if its bottom line is inconsistent with Neall's budget-cutting priorities.

In the coming year, it plans to review the semi-independent Board of Education and Department of Utilities as well as the capital budget.

It will also explore establishing a restricted "rainy day fund" to take the place of the 2 percent surplus it advised is needed to preserve the county's credit rating.

Citizen input on the budget could also be vastly expanded in the coming year, when the panel plans to hold a series of public hearings throughout the county.

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