As budget time nears, Ulman struggles to project revenue

The Baltimore Sun

The last thing any politician wants to do is raise taxes the year before an election, which makes Howard County Executive Ken Ulman's struggle to come up with a balanced budget for fiscal 2010 all the more daunting.

Like many state and local leaders, Ulman is hoping the federal stimulus will help, but it might not provide much for ordinary operating expenses. Meanwhile, his administration is trying to figure out what revenue projections to use and how much spending is safe. Ulman is scheduled to present his budget in mid-April, and the County Council has until June 1 to make changes.

"We don't know what the next few months, as we close out the fiscal year, are going to be like," Ulman told a group of about 100 social service providers at a recent breakfast. "We're projecting flat revenue, at best. ... Things could get worse."

Anirban Basu, an economist and consultant for the county's Spending Affordability Committee, said he believes the recession will assume a sort of "V" shape, with a sharp decline followed quickly by a rapid recovery, though perhaps not as extended.

The federal stimulus won't help in the first six months of 2009, he said, but his guess is that improvements will begin in 2010.

"2011 is shaping up to be a brilliant year," he recently told the committee, which convenes for several weeks each winter to advise the county executive. "The [stock] market wants to head higher - you can feel it."

In the meantime, the watchword is caution, he advised.

That seems to be the inclination among committee members, who will deliver their recommendations later this month.

Several, such as Kevin Bell, a General Motors vehicle dealer in Clarksville, said they're seeing business conditions worse than anything in their experience.

But budget director Raymond S. Wacks pointed out that property tax revenue will continue to increase because of Maryland's system of deferring taxes on a portion of each existing home to prevent sudden increases.

"The good news for the county is that its largest single revenue source is still growing," Wacks said at the group's last meeting.

Income taxes, the county's second-largest source of funding, are the big question, he said. Most committee members agreed.

Since no one on the committee said they expect a tax increase, county spending will have to be cut, despite rising costs for energy, health care, debt service and pensions.

In one statistical model shown to the committee, even a 3 percent increase in county spending could produce a shortfall next fiscal year, partly because of a steep drop predicted in year-end surplus.

Nature center plans

In this time of financial troubles, the county's recreation and parks director, Gary J. Arthur, sees a silver lining.

If he can get council approval on funding to start building the $17.4 million Robinson Nature Center on Cedar Lane this year, he believes the recession could help push down construction costs.

Arthur will ask the council tomorrow night to approve one bill and one budget transfer to provide the final $5.4 million to get the project rolling.

"We think the prices out there are very, very good," Arthur told the council at a work session last week.

Councilwoman Courtney Watson recalled that as a school board member, she saw Marriotts Ridge High School come in $15 million under budget during the last recession.

Of course, the prospect of savings is relative. The recreation project was first estimated to cost $4.3 million when the county, using state money, bought the land from the James and Anne Robinson Foundation in 2005. The late Anne Robinson had sold her property to the county for $2 million but gave much of that money back to the county to help make the center she long dreamed of become a reality.

The price escalation shocked some council members, who nonetheless remain supportive. Of more concern, several said, is traffic safety along the curved section of Cedar Lane, where council Chairwoman Mary Kay Sigaty said people commonly speed.

Arthur told the council that the initial lower price was an off-the-cuff estimate before any actual design work or citizen participation had taken place. After state and private contributions, the county will end up spending $12.9 million, he said.

The higher price tag is due mainly to three things, Arthur said. The building size was expanded from 15,000 to 24,000 square feet to meet school system requests. Also, the environmental features were bolstered to the highest level possible to make the building a showplace for students and visitors. Finally, an attempt to get a property easement along Cedar Lane for an easier entrance failed when the landowner objected to losing a line of mature pine trees that help provide privacy. That added $1.2 million to the cost for a 423-foot driveway and a retaining wall that must be 17 feet high in places.

Joan Lancos, a former Planning Board member who served on the center's design committee, said the larger size and upgraded environmental features are worth doing because the center, on 18 wooded acres at the eastern tip of the Middle Patuxent Environmental Areas, will attract students and others to learn about the natural world.

"This is going to mean so much," Lancos said. "It's the right choice to make at this time."

Foreclosure funding

In other recession-related news, the county is set to receive $4.4 million in federal money to buy, rehabilitate and resell at reduced prices about 18 foreclosed, bank-owned homes in east Columbia and North Laurel.

This is the county's share of a $3.9 billion federal program approved in July to help communities avoid blight from abandoned homes.

An article in the Howard County section March 1 incorrectly reported the status of the county government's effort to obtain federal foreclosure aid. The county is in the process of applying for the funding.The Baltimore Sun regrets the error.
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