In a May 22 letter, Harford County Executive David Craig has withdrawn legislation before the Harford County Council to fund the remaining costs of a one-time compensation enhancement for county and school employees. Since the County will now be obliged to draw down reserves to pay for the newly shifted costs of teacher pensions, the reserves that had been targeted for this employee relief are no longer available.
As you are aware, during the recent Special Session of the Maryland General Assembly, legislators passed a Budget Reconciliation and Financing Act that included a shift of teacher pension obligations previously funded by the state to county governments. This new obligation is in addition to our Maintenance of Effort obligation. For Harford County, this means an additional $5.5 million expense for Fiscal Year 2013.
In order to pay for this new obligation, I respectfully ask that bills 12-21, 12-22, and 12-23 be withdrawn. This is not an action which I take lightly, but given the difficult position in which the Governor and the General Assembly have placed us, this is the most prudent course of action to take. By paying for teacher pensions using our fund balance, we are able to avoid furloughs, layoffs, cuts in services, or an increase in the property or income tax rates.