Howard County Executive Ken Ulman's second budget proposal is due out Tuesday and it represents a tricky balancing act.
Ulman wants to expand recycling and hire 22 more police officers. He's agreed to give police a 5 percent pay raise worth $1.8 million, and firefighters a 6 percent increase worth $1.4 million. Teachers have a contract with the school board that calls for a 5 percent raise, which will cost $30 million.
But how much spending growth can the county allow - without tax increases - and still afford to sock away millions for future retiree health benefits?
That balance came up last week as the County Council, which has the ultimate say on Ulman's spending plan for fiscal 2009, reviewed this year's report by the Spending Affordability Committee.
Much of the discussion centered on income tax revenue. Not knowing what effect the recession will have on that revenue makes it hard for planners to craft projections, budget administrator Raymond S. Wacks told the council.
The members of the affordability committee, composed of resident appointees, wrestled with that as they composed their report in February.
"We don't really know for sure how deep and how long [the economic downturn] will be," said Arnold Holz, a committee member.
For now, county revenues are not an area of concern, Wacks said. But next year, when businesses gauge profits from calendar year 2008 and make estimated tax payments, revenues could decline.
School board chairman Frank Aquino, who also served on the spending committee, said the panel worried about the county's $477 million liability for retiree health benefits. Over the next eight years, the county is to increase the annual contribution until it reaches $53 million a year.
Another key focus was money for schools, which Wacks called the "largest single driver" of county spending. In the report, Wacks used a statistical model that assumes public school spending will increase 7 percent a year. That led to a projection of a shortfall starting in the next fiscal year roughly equal to the retiree payment obligation.
But Councilman Calvin Ball, an east Columbia Democrat, questioned the spending rate in the model.
"How realistic do you feel these assumptions are?" he asked Raymond Brown, the school system's chief operating officer, who also served on the committee.
Brown acknowledged that education spending has risen more than 8 percent annually in recent years.
Council Chairman Courtney Watson, an Ellicott City Democrat, said she's worried about capital expenses, too - especially with the rapid inflation of school construction costs.
"There are going to be some tough decisions in the future," Wacks told the council.
The council will begin reviewing Ulman's proposed budget and has scheduled a final vote on the plan on May 22.
State of taxes
The annual deadline for filing income tax returns came and went last week, and Howard County Republicans used the occasion to remind voters that Democrats and Gov. Martin O'Malley raised taxes to help fill a projected $1.2 billion budget hole. The GOP pushed for spending cuts to achieve the purpose, a remedy Democrats rejected as too harsh.
Brandishing a variety of picket signs, about 30 Republican activists marched along Little Patuxent Parkway near the Mall in Columbia last Saturday. They even invented a proposed new state motto - "TaxInUs Maximus."
Led by state Sen. Allan H. Kittleman and Del. Warren E. Miller, the group encouraged sympathetic motorists to honk and handed out bumper stickers. The signs bore slogans such as "Vote Republican, it's less taxing" and "Stop Democrat Tax Increases." They got some spirited responses from motorists.
Asked how they felt about federal deficit spending that under President Bush has more than doubled the national debt to nearly $9.5 trillion, Kittleman said, "We're state legislators. We're talking about state government."
Miller added, "I can't criticize the current president. He hasn't increased taxes."
Michael C.A. McPherson, chairman of the Howard Democrats, said O'Malley and the General Assembly "have done an admirable job." The governor, he said, was left "to clean up a mess left by the previous administration."