Monday, March 22, 2010

How the Counties Spend Your Money, Part One

Many Maryland counties are experiencing budget problems these days, exacerbated both by the economy and cutbacks in state aid. That is prompting many elected officials and government staffers to try to get a handle on county spending. What drives it? What levels are reasonable? What should each county’s priorities be? This series, in which we compare county spending levels across a number of criteria, is our effort to contribute to that investigation.

Our goal is to compare county spending in several major categories as well as on a per-capita basis. We obtained approved Fiscal Year 2009 budgets from every county website except for three that did not post them: Caroline, Kent and Somerset. We then broke that spending down into the following categories that are reported by the remaining twenty-one jurisdictions:

County Executive/Mayor/Manager
County Council/County Commissioners
Board of Elections
Circuit Court
State’s Attorney
Fire & Rescue/EMS
Law Enforcement (Includes Police, Sheriff and Corrections)
Health/Human Services/Housing
Economic Development
Public Schools
Debt Service

This proved to be a challenging exercise for two reasons:

1. Some county budgets include state aid and others do not. We partially accounted for that by subtracting the county school budgets from the county totals and putting only the local contribution to schools back in, thus systematically removing state and federal school aid from the budgets. Over eighty percent of state aid to counties consists of aid to public schools, but other aid sources do remain. That introduces some variability into the data by biasing the total budgets of the poorer jurisdictions, which receive more aid, slightly upwards.

2. Some counties include different line items in each of the above functions. We attempted to standardize them – for example, by looking for all housing-related items no matter their department and including it alongside HHS – but we suspect we could not achieve 100% standardization.

Nevertheless, after weeks of crunching this data, we believe we have gotten as close to an apples-to-apples comparison between the counties as anyone else ever has.

Following are the total budgets for each of the twenty-one reporting jurisdictions. We list the raw total reported by each county, the adjusted total when only local school spending is included and the per capita total based on 2008 population counts.

Montgomery County spends $3,986 per resident, the second-highest total in the state. That is no surprise given the county’s liberal political culture. But the biggest spender in per-capita terms is Howard County ($4,298), which is very wealthy but is also competitive between the two parties. Worcester County (third at $3,779) is another surprise since it often votes for Republicans. The lowest-spending counties tend to be located in Western Maryland and the Eastern Shore. Baltimore County is a standout for its spending restraint.

Some of the differences in per capita spending can be explained by differences in area wealth. Howard and Montgomery residents tend to have high incomes and can afford high tax burdens. So we compared per capita county spending to 2007 per capita incomes to calculate what percentage of resident incomes was spent by each county. Here are those results.

Baltimore City, which spends 15.4% of its residents’ income, is off the charts. While that figure includes some forms of state aid, it does not include school aid or the state’s operation of its community college, booking facility, detention center or subway system. The city charges by far the highest real property tax rate in the state. Its 7/1/09 rate of 2.268 per $100 of assessable value is more than double the second-highest rate in Maryland, which is charged by Harford County (1.064). Howard (at 10.0%) and Montgomery (8.6%) are second and third in county spending as a percentage of per capita income. Prince George’s County is fourth (at 8.4%) despite its tax-limiting TRIM amendment.

We will start looking at line items tomorrow.