First Nancy Navarro, second Nancy Floreen, third Valerie Ervin and now Roger Berliner's event in Chevy Chase. These two unions are a threat to wind up anywhere now.
Showing posts with label County Budget 2010. Show all posts
Showing posts with label County Budget 2010. Show all posts
Wednesday, June 16, 2010
Police, Fire Fighters Picket Berliner Fundraiser
Tuesday, June 15, 2010
Police Picket Ervin Fundraiser (Update)
Last night, the Fraternal Order of Police Lodge 35 picketed Council Member Valerie Ervin's fundraiser in Downtown Silver Spring. It's one thing for the police to picket Nancy Navarro or Nancy Floreen, but it's quite another for them to picket a twenty-five year veteran of the labor movement like Ervin. Still, Ervin supported furloughs along with the rest of the council.
Council Member Duchy Trachtenberg, who has changed her position to reject all county employee union support, prepares to cross the picket line.
Update: We hear other politicians crossed the picket line too. Trachtenberg is the only one for whom we have a photograph.
Wednesday, June 09, 2010
Police, Fire Fighters Picket Floreen Fundraiser
Less than three weeks after picketing Council Member Nancy Navarro's fundraiser in Silver Spring, the police and fire fighter unions picketed a fundraiser held by Council President Nancy Floreen in Bethesda tonight. Someone at the event was so unhappy with the demonstrators that he or she called police management to complain. Ever hear of the First Amendment, people?
Friday, May 28, 2010
Consequences of the Budget, Part Five
Budgets have political consequences. This one was no exception. Here are a few things that stand out.
1. Dominance of the Bond Rating Agencies
In our very first blog post, we labeled MCEA the “800-pound gorilla of MoCo.” No more. Now the county has three 800-pound gorillas: Standard & Poor’s, Moody’s and Fitch. When the rating agencies began issuing warnings on the county’s AAA bond rating, the County Executive and the council immediately moved to increase the size of the energy tax hike, grab more money from furloughs and the school system and boost next year’s reserve from 5% to 6% of the general fund. One aggrieved labor leader compared the county to a third world country having to deal with the IMF. For years and years, the Post, taxpayer groups, conservatives and others have howled in the wind about fiscal discipline while the council regularly approved budget increases in the upper single digits (or more). The rating agencies have successfully bullied the elected officials into spending restraint – at least, for now.
2. The Unexpected
There were a number of surprises this year. First, Council Member Duchy Trachtenberg flipped her vote to yes on the ambulance fee, allowing it to pass 5-4. In explaining her change of mind to the Gazette, she said, “We no longer have the luxury of leaving insurance money on the table.” Well, if the ambulance fee was nothing more than insurance money, why not support it last year or the year before? The volunteer fire fighters are now vowing to unseat everyone who supported the fee, adding to Trachtenberg’s LONG list of enemies.
Second, long-time business allies Nancy Floreen and George Leventhal supported the energy tax against loud outcries from their friends. Floreen told them, “At this point we have to raise this revenue… We have no choice.” Leventhal said, “We’re in a box. We need the revenue... We’re faced with a lot of really hard choices.” All the Council Members wound up favoring an increase of some kind, though they disagreed on the amount and the final hike was a compromise.
Third, former Board of Education members Ervin and Navarro turned a lot of heads by taking on both the school system and the school unions. Ervin was out front early in supporting school furloughs and voted with Navarro and Trachtenberg in favor of them in the Management and Fiscal Policy Committee. That quickly became the position of the entire council. School officials and school union leaders were sorely disappointed with both women, whom they expected to defend them. One such official accused them of “hypocrisy” by pointing out the contrast between rhetorical statements about protecting kids and demands for teacher furloughs. Another official said that both women had “alienated” some in the school unions. This level of rage coming from the schools proves once and for all that neither Ervin nor Navarro can ever be characterized as servants of Jerry Weast or labor.
3. Sticking Together
The council was under intense pressure from all sides during the crisis. But rather than pull them apart, it actually pushed them together. Your author has heard multiple stories of Council Members who were barely on speaking terms with each other now being bosom buddies! None of them felt they had many choices, and all were battered and hardened by the abusive emails they received. (The ones containing grammatical errors that were sent by teachers provoked some gallows humor about the need to invest more in teacher training.) At the end, the Council Members had no one but each other. This may not last, but it was a unique moment during this term.
One benefit to this is that it becomes harder for endorsing organizations to differentiate between the incumbents. Labor is displeased with furloughs, but every Council Member supported them. Business is displeased with the energy tax hike, but every Council Member except Phil Andrews voted for it. (Andrews wanted an even steeper levy on business customers.) Every Council Member voted for the budget except Andrews and Knapp. Andrews voted against it because of the ambulance tax, while Knapp is displeased over “one-time solutions.” Unless an endorsing organization thinks it can take out seven or more incumbents, there’s not a lot to work with here.
One outraged observer sputtered, “A majority of this council is determined to appear united and unanimous out of a perceived need for incumbents to circle the wagons for the September primaries. That means that the majority will follow the minority to achieve the goal of unanimity. It is about them and their careers, not the taxpayers.” That’s fine, but what are you going to do about it?
4. Common Interest
The Council Members are not the only ones with common interest. The business community was hammered by the energy tax. County employees received no raises and some were furloughed. Non-profits and immigrants will endure large grant and service cuts. The smart growth community is constantly defending the Ride On system from route eliminations and schedule cuts. This is all going to continue.
The common enemy that all of these groups have is not the County Executive or the County Council: it’s the lack of economic growth. In our “Population, Jobs and Commutes in the Washington Region” series, we demonstrated that Montgomery County has lagged behind Fairfax and much of the rest of the region in population, employment and real wage growth for decades. That hurts the business community by limiting profits. It hurts county employees by limiting the tax base. It hurts the non-profits, the poor and the immigrant community by limiting services. And it hurts the pursuit of smart growth by limiting revenues necessary to build transit projects. Whether they know it or not, their interests are all intertwined. In the end, just like the politicians, all these groups have is each other. Only if these communities work together in pursuit of economic revitalization will MoCo’s long, slow fall come to an end.
Thursday, May 27, 2010
County Council Passes FY 2011 Operating Budget
Following is the council's press release.
Montgomery County Council Approves $4.3 Billion Total Operating Budget for FY11
4.5 Percent Decrease for All-Agencies Budget Is First Decrease Since Adoption of County Charter in 1968
Tax-Supported Budget of $3.66 Billion Is 5.0 Percent Decrease;
Approximately 450 County Government Positions Eliminated
Schools, Public Safety, ‘Safety Net’ Are Priorities; Property Tax
Stays Within Charter Limit; $692 Tax Credit for Homeowners
ROCKVILLE, Md., May 27, 2010—In an austere year caused by the deep recession, the Montgomery County Council today approved a $4.3 billion total County operating budget for Fiscal Year 2011, which begins July 1. The budget is 4.5 percent less than the approved budget for FY10, marking the first decrease in a total budget since the adoption of the current County Charter in 1968.
Since March 15, when County Executive Isiah Leggett presented his recommended budget, the Council has worked to achieve equity in the allocation of limited funds. On May 19, the Council unanimously agreed to reduce the budget for Montgomery County Public Schools (MCPS) by $19.7 million in the operating budget and $4.7 million in capital budget, for a total reduction of $24.4 million (1.1 percent less than proposed by the Executive). These funds will help mitigate deep cuts in the safety net and other vital services, including Montgomery College. The MCPS share of the total combined agency costs will be 57 percent, compared to 55 percent this year.
The County Government operating budget and the Aggregate Operating Budget (including spending affordability guidelines) were each approved by 7-2 votes. Council President Nancy Floreen, Council Vice President Valerie Ervin and Councilmembers Roger Berliner, Marc Elrich, George Leventhal, Nancy Navarro and Duchy Trachtenberg voted to approve each budget. Councilmembers Phil Andrews and Mike Knapp voted against the proposals.
On May 20, the Council voted to restore a number of significant items to the budget, including key additions that address health and human services needs. Items added include additional funding for the Montgomery Cares, the Patient Navigator program, MCPS school health room aides, residential treatment providers, the Community Vision program, Parent Resource Centers, residential treatment provider supplements and the Mental Health Association suicide hotline. Funds also were restored so that contracts for health and human services would be reduced by 5 percent, instead of the 7 percent recommended by the Executive.
The budget re-establishes the reserve at 6 percent, which should help maintain the County’s AAA bond rating. The reserve was reduced to 5 percent in FY10.
The overall tax-supported budget of $3.66 billion is down $191.0 million from the FY10 adopted budget, a decrease of 5.0 percent. This is the second consecutive year the tax-supported portion of the budget has decreased.
“In this austere budget year, we are all in this together,” said Council President Floreen. “Despite a record drop in revenue, we have worked to develop a budget that is fair – fair to our residents who rely on County services, fair to taxpayers and fair to employees. We have also increased our reserve, and we are working on a balanced fiscal plan for the next six years.
“In allocating sharply reduced resources, we have given top priority to our school children – the MCPS share of total agency spending is 57 percent, up from 55 percent in FY10 and over the last decade – as well as Montgomery College, public safety and the safety net.”
The Council also approved the total Fiscal Years 2011-16 Capital Improvements Program (CIP) of $3.9 billion. The six-year CIP plan for all agencies (excluding the Washington Suburban Sanitary Commission) addresses major projects. The approved CIP is an increase of $167 million (4.5 percent) from the previous CIP. The $3.86 billion for the tax-supported part of the CIP is an increase of $197.5 million (5.4 percent) from the previous CIP. The CIP for Montgomery County Public Schools increased by about 10 percent, including funds for 28 new schools and additions (including 11 projects new to this CIP).
The MCPS budget of $1.9 billion represents 56.6 percent of the budgets for the four agencies (a decrease of 1.1 percent from the FY10 approved budget); the Montgomery College budget of $215.8 million represents 6.4 percent (a decrease of 0.8 percent from the FY10 approved budget); the County Government total of $1.2 billion represents 34.3 percent (a decrease of 6.9 percent from the FY10 approved budget); and the M-NCPPC budget of $92.5 million represents 2.7 percent of the budget (a decrease of 13.2 percent from the FY10 approved budget).
In a budget year complicated by the national and regional economic downturn, the Council’s budget protects core services and “safety net” programs, but does not exceed the County’s Charter Limit on property tax revenue. The budget includes a $692 property tax credit for owner-occupants of principal residences. It freezes pay for employees of County Government, Montgomery College, the Maryland-National Capital Park and Planning Commission (M-NCPPC) and MCPS.
Employees at all agencies (including the County’s public safety sectors)—except MCPS—will take unpaid furloughs in FY11. Furloughs for County Government employees, including elected officials, will be progressive: three days (24 work hours) for employees whose salaries are less than $50,000; five days (40 work hours) for those with salaries of $50,000 to $100,000; and eight days (64 work hours) for those with salaries greater than $100,000.
The Council provided funding for nine Educational Facilities Officers (EFOs) for the outreach program sponsored by the police department in partnership with the Montgomery County Public Schools. The officers involved in the program are assigned to a high school and its cluster of middle schools. The officers spend the majority of the day fostering positive interactions with students and school staff.
The budget includes a plan to consolidate all recreation facility and athletic field permitting, all class/program registration and most class/program operation in the County Department of Recreation from the M-NCPPC Department of Parks to create a more streamlined and user-friendly system for County residents. The Council believes this consolidation, over time, will lead to budget savings and operational efficiencies.
Councilmember statements on the budget agreement:
Councilmember Phil Andrews: “Although I strongly support the Council's decisions to eliminate pay increases and furlough employees to minimize layoffs, I cannot vote for an operating budget that most unwisely relies on revenues from ambulance fees that will likely be rejected on referendum and that hikes energy taxes on homeowners by 150 percent."
Councilmember Roger Berliner: “In the most difficult and painful year in our County’s history, our task was to allocate pain equitably. If we are measured by that standard, I believe we performed well in respect to our responsibility.”
Councilmember Marc Elrich: “Today the Council ended an extraordinarily difficult budget process in which we reduced spending from last year’s budget by 4.5 percent. This could not have been done without the very close collaboration of my colleagues. But most importantly we had the cooperation of the County employee unions who gave up cost of living raises, length of service step increases and will get an average of five furlough days. In addition, 450 County employees will lose their jobs. Even with these sacrifices, we have been forced to make major cuts to county services while raising new revenues to address the challenges of an almost $1 billion deficit. I will continue to push efforts to reorganize and restructure County Government because our long-term sustainability depends on our ability to achieve all possible efficiencies.”
Council Vice President Valerie Ervin: "As a former member or the Board of Education and Chair of the Council's Education Committee, I know there has been a lot of anxiety about the additional $24.4 million in cuts to the school system; however, I am confident that this reduction will not impact the classroom. We always put children first, and this Council has protected the services that children need each day. In addition to providing a top-notch education, many children and their families rely on Montgomery County for health care, housing assistance, and transportation.
"We are partners with the Board of Education, and we must work together to repair any damage to our working relationship that has occurred over the last several weeks. The future of our County depends upon our leadership and this collaboration."
Councilmember Mike Knapp: “While this budget is significantly more responsive to the needs of our residents than the one proposed by the County Executive, it still relies too much on tax increases, tenuous assumptions and one-time solutions—which all but guarantees that we will be addressing many of the same issues a year from now. I appreciate the work that has gone into this budget, but regret that, ultimately, I cannot support it.”
Councilmember George Leventhal: “In his 1996 State of the Union message, President Bill Clinton said, ‘The era of big government is over.’ Many of his liberal supporters were dismayed, but we face a similar moment in Montgomery County today. President Clinton said further, ‘The era of big government is over. But we can't go back to the era of fending for yourself. We have to go forward to the era of working together as a community, as a team, as one America, with all of us reaching across these lines that divide us—the division, the discrimination, the rancor—we have to reach across it to find common ground. We have got to work together if we want America to work.’ In Montgomery County today, we know we must reorient our expectations and reinvent county government so that our taxpayers can afford it. As we look ahead to the years to come when we must develop a long-range plan for economic sustainability, I am optimistic – just as President Clinton was -- that our future will be bright if we work together.”
Councilmember Nancy Navarro: “In order to create this budget, my colleagues and I had to make many difficult decisions and some important changes to the County Executive’s proposed budget. Recognizing the importance of our public school system, we approved a final budget for Montgomery County Public Schools that amounted to only a 1.3 percent reduction from its FY10 budget, while increasing its capital budget by 10 percent. I am confident that our School Board and Superintendent Jerry Weast will institute any necessary reductions in a manner that minimizes any impact on schoolchildren. My two daughters are MCPS students and I served on the Board for five years, so I know that their education is in good hands.”
Councilmember Duchy Trachtenberg: "Serving on the Montgomery County Council has been a continuation of my life's work to represent our most vulnerable citizens and to give them a voice in policy and budget decisions. As I've often stated, they are not strangers to us, for they are the neighbors and friends and sometimes family members who ride our buses, receive a free meal at the senior center, or seek shelter and refuge in time of crisis. In this year's budget, the Council has once again demonstrated its commitment to putting people first. Despite the reversal of economic fortune, we have prioritized the needs of our citizens and there is no wiser investment in our future than that.
“In the months ahead, the Council will need to define a sustainable fiscal plan; an improved reserve fund policy; a collaborative effort to address our very large compensation and benefit obligations; and a constructive approach in consolidating and restructuring our County service delivery. We must succeed in these efforts for our residents deserve nothing less."
Key Council Actions Regarding FY 2011 Montgomery County Operating Budget:
Police
Increased the July 2010 candidate class from 30 to 36 at a cost of $278,100. This would allow those who have already received job offers the opportunity to move forward in the hiring process, since the January 2011 class has been abolished.
Restored $126,920 to retain the four Police satellite facilities at Olney, Piney Branch, East County and Clopper Road
Montgomery College
Restored $2.5 million for enrollment growth and $1.9 million for operation of new facilities
Health and Human Services
Restored $112,000 for the Patient Navigator program
Restored $462,340 for the Montgomery Cares program, allowing for an additional 70,000 primary care visits retaining the current reimbursement rate of $62
Restored $183,300 for Fund 3 Eligibility Screeners
Increased funding $70,000 for Respite Care
Restored $1,541,340 for School Health Room Aides
Restored $66,530 for residential treatment providers
Restored $218,790 for the Community Vision program
Restored $48,120 for Parent Resource Centers
Provided $487,010 so contracts to health providers would be reduced by 5 percent instead of 7 percent
Provided $165,000 so contracts for development disability service providers would be reduced by 5 percent instead of 7 percent
Provided $20,250 so contracts for residential treatment provider supplements would be reduced by 5 percent instead of 7 percent
Restored $25,000 for the Mental Health Association’s suicide hotline
Children Youth and Families
$21.4 million for Child Welfare Services
• $15 million for income supports for low-income families and individuals in need of food, medical and other assistance
• $4.1 million for services that support youth involved in or at risk for involvement in the juvenile justice system or in need of substance abuse of other services.
• $4.8 million for Linkages to Learning
• $3.8 million for Child Care Subsidies
• $3.5 million for evaluation, assessment, and early intervention services to families with children under age three when there is a concern about development
• $3.1 million for services focused on increasing the quality early care and education programs available to young children
• $1.8 million for positive youth development and gang prevention and intervention for youth at risk of joining or involved in gangs
Arts and Humanities
Provided $500,000 for Olney Theatre, available if the theatre meets certain conditions
Maryland-National Capital Park and Planning Commission
• Voted to consolidate recreation facility and athletic field permitting, class/program registration and some recreation program operation into County Government from the M-NCPPC Department of Parks to create a more streamlined and user-friendly system for County residents. The Council believes this consolidation, over time, will lead to budget savings and operational efficiencies
• Approved a work program for the Planning Department that allows it to continue work on the zoning ordinance rewrite and begin work on several new master plan initiatives in FY11.
• Voted to consolidate the Park Police and the Montgomery County Police communications and dispatch operations
• Restored $95,000 for consulting services for Route 29 Corridor Plan
• Restored $81,900 for the deer management program
Community Grants
Approved $968,300 (approximately half of the $1,845,800 approved for Council grants in FY10) for a total of 33 grants to nonprofit organizations to support a variety of programs and services, including food, eviction prevention, utility assistance and other safety net services to help low income families facing severe economic hardships.
This includes programs such as Manna Food Center’s weekend food program for low income school children and A Wider Circle’s donated furniture distribution to low income families.
Funded several youth development proposals from community nonprofit organizations working to prevent teen pregnancy, help low income first generation students get into college and provide needed after school programs for County youth.
Provided $100,000 to assist with capital improvements for the Ivymount School, a special education school for students with disabilities.
Approved $1,004,700 (compared to $1,845,800 approved for Council grants in FY10) for a total of 35 grants to nonprofit organizations to support a variety of programs and services, including food, eviction prevention, utility assistance and other safety net services to help low income families facing severe economic hardships.
This includes programs such as Manna Food Center’s weekend food program for low income school children and A Wider Circle’s donated furniture distribution to low income families.
Municipal Tax Duplication
Provided $748,820 to restore half of the cut in payments to municipalities recommended on April 22 by the County Executive
Working Families Income Supplement
Provided $1 million to restore part of reductions recommended on April 22 by the County Executive
Historic Preservation
• Restored $109,420 for the Historic Preservation Commission’s responsibilities
Environment
• Voted along with Prince George’s County Council to increase water and sewer charges for the Washington Suburban Sanitary Commission by 8.5 percent
• Increased the Water Quality Protection Fund budget to cover the inspection and maintenance of stormwater management facilities transferred into the program
• Increased the Water Quality Protection Fund budget for additional staff to assist in the implementation of the National Pollution Discharge Elimination System (NPDES) permit.
Highlights FY 2011-16 Capital Improvements Program (CIP) for MCPS
The FY11-16 CIP adopted by the Council will be just under $4 billion, about 6 percent higher than previous approved CIP. The Montgomery County Public Schools CIP will increase by more than 10 percent. The key changes are:
Funds 28 new schools and additions, including the 11 projects new to this CIP: Bradley Hills Elementary addition, Clarksburg/Damascus Middle addition, Clarksburg High School addition,,Clarksburg Village Elementary (new school), Darnestown Elementary addition, Georgian Forest Elementary addition, Somerset Elementary addition, Viers Mill Elementary addition, Waters Landing Elementary addition, Westbrook Elementary addition and Wyngate Elementary addition
Adds $6.6 million for one or more additions to elementary schools in the Richard Montgomery Cluster, where MCPS forecasts overcrowding within the next 5 years. In the next year or two the Board of Education will identify where the addition(s) will be built
Keeps all 27 school replacement/modernization projects on the Board of Education’s requested schedule
Funds $11.3 million in FYs11-12 to build gyms in the remaining 7 elementary schools that do not have them
Increases HVAC Replacement funding by $9.4 million (168 percent) in FY11
Increases Planned Lifecycle Asset Replacement funding by $1.9 million (45 percent) in FY11
Increases funds for ADA Compliance by $0.9 million (87 percent) annually
Increases funds for Indoor Air Quality projects by $0.8 million (61 percent) in FY11
Adds $6 million to renovate restrooms in 71 schools during FYs11-16
To achieve a balanced budget, the Council took action on several proposals to increase revenue. These actions included:
Approved Bill 13-10 that creates the Emergency Medical Services Transport Fee (or ambulance fee) proposed by the County Executive. Bill 13-10 authorizes the County to charge the health insurance companies of those transported by County ambulances between $300 and $800, depending upon the level of care needed. They also will be charged $8.50 per mile of transport. Residents will not be charged for any co-pays or deductibles that are not covered by insurance. Residents without health insurance will not be charged. It is estimated the fees could raise approximately $12.9 million annually for the County. Fees could be charged as early as July 1.
Approved Expedited Bill 29-10, which will make Montgomery County the first County in the nation to create a carbon emissions tax on major emitters of carbon dioxide. The carbon tax, whose chief sponsor is Councilmember Roger Berliner, will require a major emitter of carbon to pay an excise tax of $5 per ton of carbon emitted. Currently, the only impacted emitter would be the Mirant Corporation power plant in Dickerson.
Approved a resolution that reflects the County Executive’s proposal to increase the County tax on energy use, including on home heating oil, electric and natural gas. The Executive proposed doubling the energy tax, but the Council reduced the increase to 85 percent in FY11. The measure will split the increase between residential and commercial users. The average County household will pay $13 more per month than it currently does, depending upon the type of energy primarily used in the home and the amount of energy used. The bill will sunset after two years.
Approved an increase to the current tax on cell phone lines from $2 to $3.50 per line per month.
Consequences of the Budget, Part Four
This year’s budget was tough. But dealing with the county’s long-run fiscal future will be even tougher.
The chart below, adapted from the County Executive’s proposed operating budget, summarizes the county’s fiscal difficulties in a nutshell. The bottom line represents resources available to the county from FY 2012 through FY 2016, consisting of taxes, state and federal aid, fees and fines, investment income and reserves. The top line represents uses – in other words, spending on operations and capital. Note the fact that these two lines are never projected to meet. This is the very essence of a structural deficit.
The county is projecting deficits of $212 million in FY 2012, $303 million in FY 2013, $415 million in FY 2014, $464 million in FY 2015 and $514 million in FY 2016. But these estimates likely understate the problem for six reasons. First, Annapolis may very well hand off tens, perhaps even hundreds of millions of dollars in teacher pension liabilities to the counties next year. No county will pay more than Montgomery. Second, the state has received $4.5 billion in federal stimulus funds over the last three fiscal years (2009-2011). That money will dry up, and as it goes, so will state aid to the counties. Third, if the county cannot match its prior year per-pupil local education funding, it may be fined by the state in accordance with the Maintenance of Effort law. (It narrowly escaped that fate this year.) Fourth, the county has been delaying payments it owes for retiree health benefit costs. It must resume them in the future and they will add up to tens of millions every year. Fifth, the bond rating agencies are pressuring the county to increase its reserve from 6% of the general fund to 10%. That will siphon off money that would otherwise be available to county agencies. And sixth, if the county cannot show the bond agencies that it has a long-run plan to make the resource and use lines shown above meet next year and every year, it will lose its AAA bond rating. That means borrowing costs will go up. All of the above together represents a VERY SERIOUS challenge.
Consider these comments from informants inside the county government.
Spy #1:Fiscal policy is forever changed so that any future expansion of services has to be in the context of setting higher reserve levels. If you consider the bond house demands that we move toward 10% reserves over time, that we have to start paying into the other retirement fund, that we’re likely to get teacher pensions in part - those are going to be fixed demands against every new dollar of revenue. So while the budget may grow, much of that growth will be captured in funds that just sit there and provide security against another economic meltdown like this one. In that context, service restoration will be slow and contracts aren’t going to see any significant increases for awhile. We don’t have many revenue sources that fill these large gaps. A year ago people thought we’d solve next year’s problem with a tax increase. Now we’ll need the increase just to stay level and it’s unlikely to close the gap.
Spy #2:The Montgomery County Executive, County Council, and the Maryland General Assembly must come to terms with the fact that the Maintenance of Effort law and the 2006 pension agreement for teachers were predicated upon a faulty assumption that revenues would rise every year. Our county and state simply cannot afford to comply with either of these laws now. Both must be revised. MCEA [county teachers] and MSTA [state teachers] will fight any changes tooth and nail but elected officials must resist pressure from the teachers’ union or our county and state will be insolvent in the next few years. Good managers can increase productivity with shrinking resources and the Montgomery County Public Schools must learn to do the same thing…
Spy #3:
The county must now persuade the rating houses that it has a long-term plan for fiscal solvency and that too is likely to provoke stiff opposition from the teachers and other public employee unions. Employee compensation and benefits can no longer rise at a rate two to three times the increase in the Consumer Price Index as they have during the past decade.Bottom line is that unless we get a big boost in the tax base in the coming year, we will have to make even worse cuts next year, because we have to keep up our reserves and start contributing to retirement health benefits (OPEB) that we’ve put off. Query whether we get downgraded by Moody’s. If we do, it will be a black mark to the county’s reputation that can never be erased and we are all probably toast, union endorsements to the contrary.
Council President Nancy Floreen has called for a study of the county’s structural deficit and Council Member Roger Berliner proposed a commission to examine it. Both are following a long tradition in MoCo of using process steps to demonstrate progress on items that need urgent action. Here is what every county politician knows but few are saying.
The current county government was built up at a time when the tax base was significantly larger. That tax base can no longer support the government at its current size. The tax base is unlikely to grow back to its former strength if the county implements anti-competitive measures like the job-killing energy tax hike while using band-aids like a new economic development authority to try to cover up its problems. As bad as this budget year was, the county eliminated just 450 positions out of its nearly 30,000-person workforce and only 90 of those positions were occupied. With labor costs accounting for roughly 80% of the budget, is this enough to achieve long-term balance?
There is a lot of blood yet to be spilled on the cutting floor. Otherwise, the county’s head itself will be on the block and the rating agencies will bring down the axe.
Tomorrow, we will look at politics.
Wednesday, May 26, 2010
Consequences of the Budget, Part Three
The school system was not the only powerful institution that was challenged by the budget. Also in the crosshairs were the public employee unions.
Labor
When analyzing the unions, it’s important to keep in mind their differences rather than assume them to be monolithic. There are six county employee unions. MCEA, which represents teachers, SEIU Local 500, which represents school support staff, and the Montgomery County Association of Administrative and Supervisory Personnel (MCAASP), which represents school supervisors, all have members in the school system. They negotiate their contracts with the Superintendent, who sends them to the elected Board of Education for approval. The County Council can set the overall size of the school budget, but they cannot dictate line items in school contracts or specific employee policies (like furloughs). The Fraternal Order of Police Lodge 35 represents police officers, the International Association of Fire Fighters Local 1664 represents career fire fighters and MCGEO represents nearly all other non-managerial line workers. These three unions negotiate contracts with the County Executive, which are then approved by the council. The County Council has lots of authority over these contracts, and can reject them, refuse to fund increases contained in them and can even strike individual provisions in them. In most years, the six unions get similar gains, but this year was different.
One significant result of this budget is an angry split between the public employee unions. None of them are getting general wage adjustments or step increases, but in other ways they are being treated differently. The County Executive’s original proposal subjected non-public safety employees to ten days of furloughs each. (The Executive does not have the authority to decide questions related to staffing in the school system.) So of the six public employee unions, only MCGEO – which represents nearly everyone except for police officers, fire fighters and education employees – would have been hit by furloughs.
MCGEO fought back, arguing that they were unfairly targeted and basic fairness held that all employees should be furloughed at the same rate. Four County Council Members agreed with MCGEO in principle at their parking garage rally. Council staff found that if furloughs were spread across the government, each employee would only have to take 1.5 days. This prompted a response from the school unions, who raised questions about the feasibility of furloughs in the schools and argued that changes to the county reserves would be sufficient to prevent all furloughs. But the council, which was under pressure from bond rating agencies, did not buy it. In the end, they chose to implement a progressive furlough structure of three to eight days for non-school employees, with higher-paid workers taking more furlough days. The school system took a budget cut but did not have to take furloughs.
This approach created winners and losers among the unions. MCGEO is a loser, but it did suffer fewer furlough days than under the Executive’s proposal. The police and fire fighters are big losers. The Executive did not propose furloughs for them, but the council implemented them anyway. The school unions successfully held off all furloughs.
Most importantly, the six unions could not agree on a common approach to the budget. While the three school unions largely stuck together, the remaining three county government unions (MCGEO, the police and fire fighters) not only went against the schools, they also went against each other. Next year could see a similar conflict. While there has always been occasional friction between the unions owing to different budget priorities and different styles (especially among the leaders), it has been a LONG time since they were this far apart.
This picture of a public safety worker protesting Council Member Nancy Navarro’s fundraiser says it all about the state of inter-union relations.
The big question is whether the unions’ disagreements over the budget will spill over into their electoral cooperation. Regardless of their squabbling, they are all better off if they make the same endorsements and work together on behalf of their candidates. If not, only their hardened enemies on the council will benefit.
Tomorrow, we’ll look at the long term.
Tuesday, May 25, 2010
MoCo Maintenance of Effort Waiver Approved (Updated)
Surprise, surprise! Our sources tell us that the State Department of Education has approved Montgomery County's FY 2011 Maintenance of Effort waiver request on a 7-5 vote. Wicomico County's waiver request was also approved. That means MoCo's statehouse delegation will not have to beg Big Daddy and Speaker Mike Busch for another bill canceling a state fine. Amidst all the budget gloom, this is a welcome bit of good news.
Update: The Gazette confirmed our report.
Consequences of the Budget, Part Two
One of the most compelling elements of the budget drama was its impact on the county’s most important government institution: its public schools.
The School System
The schools are a unique part of county government in four ways. First, their policies are set by a separate group of elected officials – the Board of Education. Second, the Superintendent is extremely powerful both by the nature of his position and, in the specific case of Jerry Weast, by the nature of his personality, intelligence and longevity. Third, the school system’s three unions – the teachers, SEIU Local 500 (which represents support staff) and the supervisors – are very influential and can move the schools’ political agenda in ways that its administrators cannot. Finally, school funding is protected by the state’s Maintenance of Effort (MOE) law, which requires counties to match the prior year’s per-pupil local funding to be eligible for state aid increases. For all of these reasons, the school budget is harder for the County Executive and the County Council to cut than the rest of the government. When the system’s needs clashed with the gigantic budget deficit, it was truly a case of an irresistible force colliding with an immoveable object.
This time, the immoveable object gave way under enormous pressure. Soon after the school board approved Weast’s $2.263 billion budget, the school system opened negotiations with the Executive branch over what the Executive’s proposal to the council would be. Weast’s budget met MOE requirements, but the Leggett administration needed a lower number to make the rest of the budget work. The two agreed on a $137 million cut from the school budget and the Executive transmitted this to the council. But then three things happened: a revenue writedown, warnings from bond rating agencies about the county’s AAA rating and the County Council’s reconciliation list. The first two added pressure for more cuts, while the last item requires explanation.
Every year, the budget process begins when the Executive sends a proposal to the council. The council then goes about adding spending items back in, which go onto a document called a “reconciliation list.” The cost of the items on that list must be reconciled, or paid for, by tax hikes or spending cuts elsewhere in the government. This year’s list contained $15 million of spending added to the Executive’s proposal. At one point, it was more than $22 million.
The school system was furious at the prospect that the County Council might take the money needed for its reconciliation items out of the schools’ budget. In the system’s view, they had already agreed to go below MOE by $137 million and to support the county’s application for a state waiver. Now the council wanted even more money to support items that the school system saw as frivolous. This was part of the motivation for Weast’s threat of litigation. He simply believed he had given up enough.
The county came much closer to litigation than most people knew. Last Wednesday at 11 AM, word went out through Rockville that the school board was calling a press conference at 1 PM to announce a lawsuit. The council was scheduled to take a straw vote on the budget at 1:30 PM. This set off a mad scramble among elected officials and school system leaders to cut a deal. At that point, only $1.6 million separated the two sides. The council came down by $600,000 and the deal was set: the schools would suffer an extra $24.4 million in cuts from the Executive’s budget. Weast and the school board GRUDGINGLY accepted it and disaster was averted.
The school system fared decently. It did not suffer nearly as big a cut as most county agencies and its employees will not be subject to furloughs. It now accounts for 57% of the county’s budget, its highest percentage in recent memory. But the conflict has had a steep medium-term cost. One Rockville source put it this way:The threat of litigation was the single most dangerous and stupid miscalculation Jerry Weast has ever made. Had the school system gone ahead and sued the county, it is highly likely the Wall Street rating agencies would have downgraded the county’s General Obligation bond rating. This would have increased the cost of borrowing for the capital budget and slowed the county’s ability to modernize and replace aging school buildings. Even with the litigation threat removed, the county is not out of the woods in terms of the risk of a downgrade…
Another spy added:
While the school system’s legal argument was shaky to begin with, the fact that it now will not sue completely discredits their argument. Never again can they make the dubious claim that the County Council has no right to reduce the schools’ appropriation below the amount recommended by the County Executive because a judge will rightly ask, “But the council did precisely that in 2010. Why didn’t you challenge them then?”Weast so overplayed his hand he almost brought everyone down with him.
For all his talent, record of achievement and force of personality, Jerry Weast has hit the end of the road with the County Council. The council’s Education Committee chair openly calls him a “Rogue Superintendent.” Few if any Council Members trust his budget numbers. When he claims to submit a “bare bones budget,” no one on the council believes him even if it is true. All of them think Weast has squirreled away secret stashes of money in his $2+ billion budget. There is no longer any fear of Weast in Rockville as even his long-time allies at the Washington Post threw him under the bus less than two months after asking the county to keep him on. Whether Weast’s approach is right or wrong, he and the council are now oil and water that will never mix again.
Tomorrow, we’ll look at the unions.
Monday, May 24, 2010
Police, Fire Fighters Picket Navarro Fundraiser
Council Member Nancy Navarro won last year’s District 4 special election with lots of labor support. But that did not stop members of Fraternal Order of Police Lodge 35 and International Association of Fire Fighters Local 1664 from picketing her fundraiser in Silver Spring’s Forest Glen Seminary yesterday. Navarro, along with the rest of the council, decided to furlough public safety workers after County Executive Ike Leggett recommended furloughs only for non-public safety employees. If the police and fire fighters will do this to Navarro, they will take on anyone. We have photos below.
Consequences of the Budget, Part One
The FY 2011 budget passed by the Montgomery County Council is an historic event. Many things that would have seemed unthinkable just a few years ago happened at the same time: double digit funding reductions in many departments, no pay increases for employees, furloughs, repeal of a negotiated pension benefit, serious questions about the county’s AAA bond rating and an absolute drop in county spending. This was a moment when the unreal became all too real.
Let’s understand that few of the above decisions were made willingly. The nearly billion dollar deficit was created by a horrendous recession and a resulting massive drop in income tax collections. Suddenly, the county’s tax base was nowhere large enough to support the $4+ billion government it had built up in good times over prior years. Some, like County Executive Ike Leggett, Council Members Marilyn Praisner and Phil Andrews and a few merit staffers had warned that the big spending increases approved during Doug Duncan’s last term would be unaffordable over the long run. But no one believed the crash would hit with such acute and devastating force.
The County Executive proposed a Fiscal Year 2011 budget that reduced county spending by 3.5%. The budget passed by the council contained an overall reduction equaling that amount, but there were differences with the Executive’s proposal. For the record, here is a comparison between the Executive’s last budget of April 22 and the final budget passed by the council.
The events of the last few months will have wide-ranging implications in a variety of ways. First, the specific tax hike chosen by the county to help close the deficit will have dire competitive consequences. Second, the County Council’s relationship with the school system and the unions has fundamentally changed over the medium term. Third, the extremely serious challenges for the county’s long-run financial viability are becoming impossible to put off. And finally, all of the above will have political impact. Over the course of this week, we will examine each of these items in turn.
Taxes
The most consequential decision in the budget process was one that was made by both the County Executive and the County Council very early on: not to break the charter limit on property taxes. The county’s charter requires a supermajority vote by the council to raise property taxes above the rate of inflation. The council voted to break that limit four times in seven years (FY 2003-2005 and FY 2009) in fiscal times that were not nearly as bad as now. The voters replied by passing the Ficker Amendment, which raised the supermajority required to break the limit from seven council votes to all nine. County elected officials perceived pushback from the electorate and vowed not to break the limit again – especially not in an election year.
This decision had a powerful impact on the budget. Property taxes account for 51% of all local tax revenues. The county already charges the maximum amount allowed by state law – 3.2% - on its income tax and that accounts for another 39% of local taxes. So now 90% of the county’s revenues were off the table for increases. The energy tax, which accounts for just 5% of local taxes, was the biggest remaining revenue item and so the executive branch targeted it for a hike.
But the problem with the energy tax is that it disproportionately impacts business customers, who pay 73% of the total levy. The Executive originally proposed increasing the tax by 39.6%. But warnings by bond rating agencies prompted him to revise the increase to 63.7% and a revenue writedown caused him to propose doubling it.
A council memo illustrated the devastating competitive consequences of that idea. Here is a comparison of the rates commercial customers would pay between different jurisdictions if MoCo’s energy tax had been doubled.
In the end, the council increased the tax by 85% but split the increase 50-50 between residents and businesses. Business customers faced a 58% tax hike. One council source explained it this way:I think the decision to reduce the energy tax for the business community was a significant move for a council that is often thought of as anti-business. We reduced it by 42% from what Ike originally proposed through a combination of reallocation to residential customers (i.e., voters) and reduction of the overall tax by 15%. Ike’s proposal was almost obscene in terms of its impact on small business.
That may be true, but because the county made a political decision to avoid the property tax, it instead chose to rely on a job-killing measure that targets employers to help close its budget gap. (Fairfax chose to raise its property tax rate to deal with its own budget crisis.) Even with the reduction in the energy tax hike passed by the council, MoCo charges a FAR higher rate than its competitors. And MoCo raised this tax right after losing Northrop Grumman. Here is a transcript of a conversation between two business owners that will almost certainly take place at the next board of trade networking luncheon.Business Owner A: “I’ve maxed out on my office space and am looking to move. What do you think about Montgomery County?”
This sort of talk will go on for a long, long time and will be a BIG problem in attracting jobs. No new economic development authority will compensate for it.
Business Owner B: “They have a big, liberal government that spends a lot of money. And when they get into trouble, they sock it to business.”
Business Owner A: “Guess I’m not moving there!”
We’ll look at the schools tomorrow.
Thursday, May 20, 2010
County Council Passes Budget
The County Council voted to approve a new operating budget today by 7-2, with Council Members Phil Andrews and Mike Knapp dissenting. Following is the council's press release.
Montgomery County Council Agrees to $4.3 Billion Total Operating Budget for FY11
4.5 Percent Decrease for All-Agencies Budget Is First Since Adoption of County Charter in 1968
Tax-Supported Budget of $3.66 Billion Is 4.9 Percent Decrease; Approximately 450 County Government Positions Eliminated
Schools, Public Safety, ‘Safety Net’ Are Priorities; Property Tax Stays Within Charter Limit; $692 Tax Credit for Homeowners
ROCKVILLE, Md., May 20, 2010—In an austere year caused by the deep recession, the Montgomery County Council today approved a $4.3 billion total County operating budget for Fiscal Year 2011, which begins July 1. The budget is 4.5 percent less than the approved budget for FY10, marking the first decrease in a total budget since the adoption of the current County Charter in 1968.
Since March 15, when County Executive Isiah Leggett presented his recommended budget, the Council has worked to achieve equity in the allocation of limited funds. On Wednesday, the Council unanimously agreed to reduce the budget for Montgomery County Public Schools (MCPS) by $24.4 million, 1.3 percent less than proposed by the Executive. These funds will be used to mitigate deep cuts in the safety net and other vital services, including Montgomery College.
At today’s meeting, the Council voted to restore a number of significant items to the budget, including key additions that address health and human services needs. Items added today include additional funding for the Montgomery Cares, the Patient Navigator program, MCPS school health room aides, residential treatment providers, the Community Vision program, Parent Resource Centers, residential treatment provider supplements and the Mental Health Association suicide hotline. Funds also were restored so that contracts for health services would be reduced by 5 percent, instead of the 7 percent recommended by the Executive.
The budget re-establishes the reserve at 6 percent, which should help maintain the County’s AAA bond rating. The reserve was reduced to 5 percent in FY10.
The overall tax-supported budget of $3.66 billion reflects a decrease of $190.3 million from the FY10 adopted budget, a decrease of 4.9 percent. This is the second consecutive year the tax-supported portion of the budget has decreased.
“In this austere budget year, we are all in this together,” said Council President Nancy Floreen. “Despite a record drop in revenue, we have worked to develop a budget that is fair – fair to our residents who rely on County services, fair to taxpayers and fair to employees. We have also increased our reserve, and we are working on a balanced fiscal plan for the next six years.
“In allocating sharply reduced resources, we have given top priority to our school children – the MCPS share of total agency spending is 57 percent, up from 55 percent in FY10 and over the last decade – as well as Montgomery College, public safety and the safety net.”
The Council also approved the total Fiscal Years 2011-16 Capital Improvements Program (CIP) of $3.9 billion. The six-year CIP plan for all agencies (excluding the Washington Suburban Sanitary Commission) addresses major projects. The approved CIP is an increase of $167 million (4.5 percent) from the previous CIP. The $3.86 billion for the tax-supported part of the CIP is an increase of $197.5 billion (5.4 percent) from the previous CIP. The CIP for Montgomery County Public Schools increased by about 10 percent, including funds for 28 new schools and additions (including 11 projects new to this CIP).
In a budget year complicated by the national and regional economic downturn, the Council’s budget protects core services and “safety net” programs, but does not exceed the County’s Charter Limit on property tax revenue. The budget includes a $692 property tax credit for owner-occupants of principal residences. It freezes pay for employees of County government, Montgomery College, the Maryland-National Capital Park and Planning Commission (M-NCPPC) and MCPS.
Employees at all agencies except MCPS will be asked to take unpaid furlough days in FY11. Furloughs for County Government employees, including elected officials, will be progressive: three days for employees whose salaries are less than $50,000; five days for those with salaries of $50,000 to $100,000; and eight days for those with salaries greater than $100,000.
The budget includes a plan to consolidate recreation facility and athletic field permitting, class/program registration and additional recreation programs into County Government from the Department of Parks to create a more streamlined and user-friendly system for County residents. The Council believes this consolidation, over time, will lead to budget savings and operational efficiencies.
Councilmember statements on the budget agreement:
Councilmember Phil Andrews: “Although I strongly support the Council's decisions to eliminate pay increases and furlough employees to minimize layoffs, I cannot vote for an operating budget that most unwisely relies on revenues from ambulance fees that will likely be rejected on referendum and that hikes energy taxes on homeowners by 150 percent."
Councilmember Roger Berliner: “In the most difficult and painful year in our County’s history, our task was to allocate pain equitably. If we are measured by that standard, I believe we performed well in respect to our responsibility.”
Councilmember Marc Elrich: “Today the Council ended an extraordinarily difficult budget process in which we reduced spending from last year’s budget by 4.5 percent. This could not have been done without the very close collaboration of my colleagues. But most importantly we had the cooperation of the County employee unions who gave up cost of living raises, length of service step increases and will get an average of five furlough days. In addition, 450 County employees will lose their jobs. Even with these sacrifices, we have been forced to make major cuts to county services while raising new revenues to address the challenges of an almost $1 billion deficit. I will continue to push efforts to reorganize and restructure County Government because our long-term sustainability depends on our ability to achieve all possible efficiencies.”
Council Vice President Valerie Ervin: "As a former member or the Board of Education and Chair of the Council's Education Committee, I know there has been a lot of anxiety about the additional $24.4 million in cuts to the school system; however, I am confident that this reduction will not impact the classroom. We always put children first, and this Council has protected the services that children need each day. In addition to providing a top-notch education, many children and their families rely on Montgomery County for health care, housing assistance, and transportation.
"We are partners with the Board of Education, and we must work together to repair any damage to our working relationship that has occurred over the last several weeks. The future of our County depends upon our leadership and this collaboration."
Councilmember Mike Knapp: “While this budget is significantly more responsive to the needs of our residents than the one proposed by the County Executive, it still relies too much on tax increases, tenuous assumptions and one-time solutions—which all but guarantees that we will be addressing many of the same issues a year from now. I appreciate the work that has gone into this budget, but regret that, ultimately, I cannot support it.”
Councilmember George Leventhal: “In his 1996 State of the Union message, President Bill Clinton said, ‘The era of big government is over.’ Many of his liberal supporters were dismayed, but we face a similar moment in Montgomery County today. President Clinton said further, ‘The era of big government is over. But we can't go back to the era of fending for yourself. We have to go forward to the era of working together as a community, as a team, as one America, with all of us reaching across these lines that divide us—the division, the discrimination, the rancor—we have to reach across it to find common ground. We have got to work together if we want America to work.’ In Montgomery County today, we know we must reorient our expectations and reinvent county government so that our taxpayers can afford it. As we look ahead to the years to come when we must develop a long-range plan for economic sustainability, I am optimistic – just as President Clinton was -- that our future will be bright if we work together.”
Councilmember Nancy Navarro: “In order to create this budget, my colleagues and I had to make many difficult decisions and some important changes to the County Executive’s proposed budget. Recognizing the importance of our public school system, we approved a final budget for Montgomery County Public Schools that amounted to only a 1.3 percent reduction from its FY10 budget, while increasing its capital budget by 10 percent. I am confident that our School Board and Superintendent Jerry Weast will institute any necessary reductions in a manner that minimizes any impact on schoolchildren. My two daughters are MCPS students and I served on the Board for five years, so I know that their education is in good hands.”
Councilmember Duchy Trachtenberg: "Serving on the Montgomery County Council has been a continuation of my life's work to represent our most vulnerable citizens and to give them a voice in policy and budget decisions. As I've often stated, they are not strangers to us, for they are the neighbors and friends and sometimes family members who ride our buses, receive a free meal at the senior center, or seek shelter and refuge in time of crisis. In this year's budget, the Council has once again demonstrated its commitment to putting people first. Despite the reversal of economic fortune, we have prioritized the needs of our citizens and there is no wiser investment in our future than that.
“In the months ahead, the Council will need to define a sustainable fiscal plan; an improved reserve fund policy; a collaborative effort to address our very large compensation and benefit obligations; and a constructive approach in consolidating and restructuring our County service delivery. We must succeed in these efforts for our residents deserve nothing less."
Key Council Actions Regarding FY 2011 Montgomery County Operating Budget:
Police
§ Increased the July 2010 candidate class from 30 to 36 at a cost of $278,100. This would allow those who have already received job offers the opportunity to move forward in the hiring process, since the January 2011 class has been abolished.
§ Restored $126,920 to retain the four Police satellite facilities at Olney, Piney Branch, East County and Clopper Road
Montgomery College
§ Restored $2.5 million for enrollment growth and $1.9 million for operation of new facilities
Health and Human Services
§ Restored $112,000 for the Patient Navigator program
§ Restored $462,340 for the Montgomery Cares program, allowing for an additional 70,000 primary care visits retaining the current reimbursement rate of $62
§ Restored $183,300 for Fund 3 Eligibility Screeners
§ Increased funding $70,000 for Respite Care
§ Restored $1,541,340 for School Health Room Aides
§ Restored $66,530 for residential treatment providers
§ Restored $218,790 for the Community Vision program
§ Restored $48,120 for Parent Resource Centers
§ Provided $487,010 so contracts to health providers would be reduced by 5 percent instead of 7 percent
§ Provided $165,000 so contracts for development disability service providers would be reduced by 5 percent instead of 7 percent
§ Provided $20,250 so contracts for residential treatment provider supplements would be reduced by 5 percent instead of 7 percent
§ Restored $25,000 for the Mental Health Association’s suicide hotline
Children Youth and Families
· $21.4 million for Child Welfare Services
· $15 million for income supports for low-income families and individuals in need of food, medical and other assistance
· $4.1 million for services that support youth involved in or at risk for involvement in the juvenile justice system or in need of substance abuse of other services.
· $4.8 million for Linkages to Learning
· $3.8 million for Child Care Subsidies
· $3.5 million for evaluation, assessment, and early intervention services to families with children under age three when there is a concern about development
· $3.1 million for services focused on increasing the quality early care and education programs available to young children
· $1.8 million for positive youth development and gang prevention and intervention for youth at risk of joining or involved in gangs
Arts and Humanities
§ Provided $500,000 for Olney Theatre, available if the theatre meets certain conditions
Maryland-National Capital Park and Planning Commission
· Voted to consolidate recreation facility and athletic field permitting, class/program registration, and additional recreation programs into County Government from the Department of Parks to create a more streamlined and user-friendly system for County residents. The Council believes this consolidation, over time, will lead to budget savings and operational efficiencies.
· Voted to consolidate the Park Police and the Montgomery County Police communications and dispatch operations
· Restored 95,000 for consulting services for Route 29 Corridor Plan
· Restored $81,900 for the deer management program
Community Grants
§ Approved $968,300 (approximately half of the $1,845,800 approved for Council grants in FY10) for a total of 33 grants to nonprofit organizations to support a variety of programs and services, including food, eviction prevention, utility assistance and other safety net services to help low income families facing severe economic hardships.
This includes programs such as Manna Food Center’s weekend food program for low income school children and A Wider Circle’s donated furniture distribution to low income families.
§ Funded several youth development proposals from community nonprofit organizations working to prevent teen pregnancy, help low income first generation students get into college and provide needed after school programs for County youth.
§ Provided $100,000 to assist with capital improvements for the Ivymount School, a special education school for students with disabilities.
Municipal Tax Duplication
§ Provided $748,820 to restore half of the cut in payments to municipalities recommended on April 22 by the County Executive
Working Families Income Supplement
§ Provided $1 million to restore part of reductions recommended on April 22 by the County Executive
Recreation
§ Restored funding for Summer Teen Programs
Historic Preservation
· Restored $109,420 for the Historic Preservation Commission’s responsibilities
Environment
· Voted along with Prince George’s County Council to increase water and sewer charges for the Washington Suburban Sanitary Commission by 8.5 percent
· Increased the Water Quality Protection Fund budget to cover the inspection and maintenance of stormwater management facilities transferred into the program
· Increased the Water Quality Protection Fund budget for additional staff to assist in the implementation of the National Pollution Discharge Elimination System (NPDES) permit.
Highlights FY 2011-16 Capital Improvements Program (CIP) for MCPS
The FY11-16 CIP adopted by the Council will be just under $4 billion, about 6 percent higher than previous approved CIP. The Montgomery County Public Schools CIP will increase by more than 10 percent. The key changes are:
§ Funds 28 new schools and additions, including the 11 projects new to this CIP: Bradley Hills Elementary addition, Clarksburg/Damascus Middle addition, Clarksburg High School addition,,Clarksburg Village Elementary (new school), Darnestown Elementary addition, Georgian Forest Elementary addition, Somerset Elementary addition, Viers Mill Elementary addition, Waters Landing Elementary addition, Westbrook Elementary addition, Wyngate Elementary addition
§ Adds $6.6 million for one or more additions to elementary schools in the Richard Montgomery Cluster, where MCPS forecasts overcrowding within the next 5 years. In the next year or two the Board of Education will identify where the addition(s) will be built
§ Keeps all 27 school replacement/modernization projects on the Board of Education’s requested schedule
§ Funds $11.3 million in FYs11-12 to build gyms in the remaining 7 elementary schools that do not have them
§ Increases HVAC Replacement funding by $9.4 million (168 percent) in FY11
§ Increases Planned Lifecycle Asset Replacement funding by $1.9 million (45 percent) in FY11
§ Increases funds for ADA Compliance by $0.9 million (87 percent) annually
§ Increases funds for Indoor Air Quality projects by $0.8 million (61 percent) in FY11
§ Adds $6 million to renovate restrooms in 71 schools during FYs11-16
To achieve a balanced budget, the Council took action on several proposals to increase revenue. These actions included:
§ Approved Bill 13-10 that creates the Emergency Medical Services Transport Fee (or ambulance fee) proposed by the County Executive. Bill 13-10 authorizes the County to charge the health insurance companies of those transported by County ambulances between $300 and $800, depending upon the level of care needed. They also will be charged $8.50 per mile of transport. Residents without health insurance will not be charged. It is estimated the fees could raise approximately $12.9 million annually for the County. Fees could be charged as early as July 1.
§ Approved Expedited Bill 29-10, which will make Montgomery County the first County in the nation to create a carbon emissions tax on major emitters of carbon dioxide. The carbon tax, whose chief sponsor is Councilmember Roger Berliner, will require a major emitter of carbon to pay an excise tax of $5 per ton of carbon emitted. Currently, the only impacted emitter would be the Mirant Corporation power plant in Dickerson.
§ Approved a resolution that reflects the County Executive’s proposal to increase the County tax on energy use, including on home heating oil, electric and natural gas. The Executive proposed doubling the energy tax, but the Council reduced the increase to 85 percent. The measure will split the increase between residential and commercial users. The average County household will pay $13 more per month than it currently does, depending upon the type of energy primarily used in the home and the amount of energy used. The bill will sunset after two years.
§ Approved an increase to the current tax on cell phone lines from $2 to $3.50 per line per month.
Wednesday, May 19, 2010
County Budget Basics in Place (Updated)
The basic items in the FY 2011 budget were settled this afternoon. Here's the rough outline.
Furloughs: All non-school employees, including the police and fire fighters, will be taking furloughs. They will be progressively structured. Employees making $50,000 or less will have to take three days, employees making between $50,000 and $100,000 will have to take five days and employees making over $100,000 will have to take eight days. School system employees will not be furloughed.
School Budget: The schools will be getting $25 million less than the County Executive proposed. MCPS will have to allocate the cut and the county's maintenance of effort waiver application will be amended to reflect it. The school system will not be suing the county.
Energy Tax: The tax will go up by 85%, not 100% as the County Executive proposed. The increase will be split 50-50 between residents and businesses, not 73% towards business as the Executive wanted. The overall increase will be 58% on business. The tax will sunset in two years. Phil Andrews was the only vote against it.
Carbon Tax: Roger Berliner's bill to tax Mirant's Dickerson power plant $5 per ton of carbon emitted passed 8-1 with Mike Knapp voting against.
Ambulance Fee: The council passed it 5-4, with George Leventhal, Mike Knapp, Nancy Floreen, Marc Elrich and Duchy Trachtenberg voting in favor. Trachtenberg had opposed the fee previously.
Reserve: Will be 6% in Fiscal 2011, not a lower amount as the school unions had wanted.
We believe the above budget outline will attract support from at least eight Council Members at the straw vote on Friday.
Update: Here are the Gazette's reports on the school budget and the ambulance fee.
Update 2: The straw vote on the budget is now scheduled for tomorrow at 1:30 PM.
Sunday, May 16, 2010
SEIU Members Tell Their Stories
MCGEO is not the only public employee union swarming the County Council building over budget concerns. SEIU Local 500, which represents school support staff, is going to do it too tomorrow. Following is an email the union sent to its members on Friday.
Dear [Member],
My name is Deb Sanders and I'm a paraeducator at John T. Baker Middle School in Damascus. I am writing to you today as a fellow MCPS staff member and SEIU Local 500 member and asking you to stand with me.
On Monday, May 17th, I will visit the Montgomery County Council, along with other Local 500 members, to deliver a message to council members - it's simple:
We are already sacrificing. You may not see it, but we see the effects of cuts every day. I've had my own hours cut and so have many of my coworkers; we're already struggling to keep up the high standards we hold ourselves to. Further cuts to MCPS would damage our schools, possibly beyond repair.
County Executive Leggett delivered to you, the Council, a balanced budget. Pass it. Don't try to cut to force furloughs on MCPS staff in the name of "fairness." Anyone with any sense who knows our situation knows that wouldn't be fair.
I'm going to deliver this message and share my own story; won't you share your story too?
Simply visit http://500.seiu.org/page/s/MCPSstory and write a few sentences about who you are, where you work, and what you and your coworkers have already sacrificed - we'll print off your story along with hundreds of others and deliver them to the County Council.
Even if you've emailed, even if you've called, I'm urging you to take this additional step.
http://500.seiu.org/page/s/MCPSstory
The more MCPS voices the Council hears the harder it will be for them to ignore the truth: that further cuts to MCPS's budget are neither necessary nor fair.
Thank you,
Deb Sanders
SERVICE EMPLOYEES INTERNATIONAL UNION LOCAL 500
901 Russell Avenue, Suite 300, Gaithersburg, MD 20879
Thursday, May 13, 2010
MCGEO's SOS Letter
MCGEO sent the following letter to the County Council today along with its SOS cards, which were filled out by thousands of residents opposing county budget cuts. MCGEO's maneuver is part of a strategy to prevent its part of the government - which is basically everything except the schools and the fire and police departments - from being cut too much to preserve the school budget. The public employee unions are now fighting over a shrinking pie.
SOS: Save Our Services
MCGEO collected about 4,000 of these cards signed by residents complaining about service cuts. The union is delivering them to Council President Nancy Floreen at noon today, which is about... exactly right now.
Tuesday, May 11, 2010
MoCo PTAs Oppose School Cuts
The Montgomery County Council of PTAs has joined the school unions and student organizations in protesting additional cuts to MCPS beyond the County Executive's proposal. Following is their statement on the budget.
May 9, 2010
Press Release
Montgomery County Council of PTAs (MCCPTA) Board of Directors Statement Regarding Recommendations for the FY 2011 Operating Budget
The Board of Directors of the Montgomery County Council of Parent Teacher Associations (MCCPTA) issues the following statement in response to the recommendation of the Management and Fiscal Policy Committee of the Montgomery County Council to cut an additional $33.7 million from the MCPS operating budget for FY 2011:
“The County Executive’s recommended budget for MCPS cuts $137 million relative to the “Maintenance of Effort” (MOE) level of funding required by the State of Maryland and would likely result in an average increase in classroom size of one student per class. This level of funding is already below the bare minimum needed to maintain our current educational standards. The Management and Fiscal Policy Committee’s recommended additional $33.7 million cut is equivalent to increasing average class size by an additional two students per class (almost 500 teaching positions), or to a reduction in five staffing days during the upcoming fiscal year. Moreover, reducing the County funding level further below the state MOE would also increase the risk of MCPS losing an additional $52 million in state funding.
“We oppose balancing the Montgomery County budget on the backs of our children.”
Kay Romero, President
Montgomery County Council of PTA (MCCPTA)
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