Four years ago, when Howard County Executive Charles I. Ecker first took office, a downturn in county revenues forced him into a tax increase, layoffs and a salary freeze for county employees. Now, as Mr. Ecker begins his second term, he faces a tough financial picture that could mean at the very least some internal belt-tightening.
County officials said this week they may be facing a $4 million shortfall in revenues from county residents' state income tax payments, based on state income tax figures for July through September.
To make matters worse, they're anticipating that this year's round of county property assessments will show the lowest rate of increase in 20 years.
Despite the bad news, "it is not likely" that the county will have to raise its property tax rate to balance next year's budget, Mr. Ecker said yesterday. "But it is too early to tell.
"We'll have to reduce some of the things we're doing," Mr. Ecker said. "We're trying to watch pennies right now."
County Budget Director Raymond S. Wacks says he's anticipating the bad financial news about county property values within two weeks. That's when he will learn the values that state assessors have given to properties in Ellicott City, west Columbia and West Friendship.
"The assessment notices are likely to be the lowest in 20 years," Mr. Wacks said. He expects the assessments to range from a 3 percent decrease to a 3 percent increase.
"While the news is not good, it would be premature to call it a crisis," he said. "It is something we'll have to be looking at very closely."
Property taxes account for about 53 percent of county revenue and local income taxes about 33 percent.
County property values had been increasing at a rate of more than 5 percent a year until the county followed the nation into a recession in 1990, Mr. Wacks said. As a result, the property tax rate -- $2.59 per $100 of assessed value -- has remained relatively stable, he said.
A national economic recovery may be under way, but Howard officials say there are signs the recession may linger longer here.
"We survived [this recession] because of the growth [of property values] in the late 1980s," Mr. Wacks said.
Since 1988, the rate of growth in assessment values has slowed, however. It reached a high of an average 16 percent increase for the three-year period ending in 1988, he said, and has been falling ever since.
Mr. Wacks says the stagnation in property values is not likely to show improvement before the turn of the century. "Even if the economy showed vast improvement today, which it's not, we wouldn't see the results for another three years," he said.
State assessors evaluate a third of the county every three years. "It will be fiscal 1999 [July 1, 1999 to June 1, 2000] at the earliest before we see assessment increases," Mr. Wacks said.
Meanwhile, Mr. Ecker hopes that the state's income tax figures for the next quarter, October to December, show improvement. "One payment does not a year make," he said.
The most recent figures available, quarterly income tax payments for the three-month period from July to September, exceeded last year's payments. But the rate of increase -- 2.78 percent -- was one of the lowest ever, Mr. Wacks said.
If those figures "are an indicator rather than a blip, we are headed for rough times," Mr. Wacks said.
If the county is headed for another economic downturn, officials are ready, Mr. Wacks said. "The difference between now and four years ago is that the county has a rainy-day fund" of about $20 million to help soften the effects of a recession, he said.