When Governor Martin O’Malley spoke at the MACo Conference in January, he pledged not to include a shift of teacher pension costs to counties as part of his budget proposal this year. He did, however, also forecast a budget plan accomplished with budget cuts, and predicted “a budget that will make everyone unhappy.” On January 21, the Administration budget was introduced, with accompanying legislation to effect the various components of the fiscal plan.
Governor’s Office Press Release
The two pieces of legislation to effect the budget plan are the budget itself, and an accompanying “reconciliation” bill (or BRFA) that alters statutes and makes other changes outside the ambit of the budget bill itself, Links to bill information for these two bills are below:
HB 70 – The Budget Bill
HB 72 – The Budget Reconciliation and Financing Act
The Department of Budget and Management prepares the budget documents, and a number of accompanying summaries to guide users and taxpayers through these complicated matters:
Department of Budget and Management Website
FY 2012 Budget Presentation
Budget Highlights
Budget Detail (3 Volumes)
The major elements of this budget proposal with major local government effect are detailed below:
(MACo staff will seek to add to this section of this blog post as the day progresses, and further details become available)
Major Cuts From This Year All Continued Into FY 2012
While not surprising, the biggest fiscal effect on county governments for the FY 2012 budget will be the extension of more than $400 million in cuts to Highway User Revenues, Local Police Aid, County Health Departments, local correctional centers, and other local functions. The deep cuts to Highway User Revenues — leaving most counties with roughly 3% of their historic funding levels for local roads and bridges — were made permanent during the 2010 legislative session. The effect on county budgets in each of these areas will be another year of severe cutbacks.
In addition, the Governor’s BRFA bill proposes to eliminate the compensation of host counties for the presence of state-owned park and recreation areas in their jurisdictions – a reduction of some $2 million in distributions scattered across a number of jurisdictions. This reduction is an extension of one originally effected in the 2009 BRFA bill, and its county-by-county effects are shown in this section of that bill’s fiscal note.
Assessment Functions – Cost Shift Proposed
Similar to a proposal made during the 2009 session, the Administration has proposed that a “proportional share” of the costs of valuing property be borne by county governments. The fiscal analysis from a comparable proposal from two years ago indicated this as a cost shift of approximately $36 million.
Detail from that fiscal note is available here: Policy Proposal Fiscal Effects
K-12 School Funding “Flat”
Despite the Thornton school funding formula calling for a meaningful increase in State support for FY 2012, the Governor’s budget provides essentially flat funding for K-12 education. This marks a roughly $100 million reduction from formula funding amounts, a reduction of less than 2%.
