Governor’s Budget: No New County Cuts, Focus On Priorities

Governor O’Malley today introduced his proposed budget for FY 2014, with a series of spending cutbacks and new priorities that generally reflect the less strained economic climate, compared to recent years.

The Governor’s budget, and accompanying budget reconciliation bill, do not include any newly proposed reductions in aid to county governments or jointly state/county funded programs. Further, previous reductions to formula funding for local police departments and health departments have been restored, consistent with the temporary nature of the statutory reductions. The cost shifting of assessment functions of the State Department of Assessments and Taxation will abate to a 50/50 split, down from a 90% county burden for each of the last two years. The net effect of these incremental changes over the FY 2013 budget should be roughly $40 million.

Reviewing the outline of the Governor’s proposed budget on Wednesday, MACo President and Wicomico County Executive Rick Pollitt said, “Governor O’Malley has consistently tried to work with local government to forge a collaborative path through the fiscal challenges we’ve had in common and we’re happy to note that his budget does not further add to our burdens. This budget targets some of our shared priorities, and that’s very important. There’s work ahead, but hopefully we can all be working together on serving the citizens we all represent, and building up those things we value most and make us one community of Marylanders.”

One of MACo’s legislative initiatives for the 2013 session is “County Budget Security,” where counties have emphasized the importance of maintaining and even restoring these local funding elements as the economy dictates. From MACo’s adopted initiative:

County Budget Security – County governments have taken the deepest cuts of any part of the state’s budget during the Great Recession. Local governments have lost some $1.8 billion in State support since Fiscal Year 2010, affecting nearly every essential local service: roads and bridges; law enforcement; health departments; and jails. Temporary cuts have been made permanent or extended with each budget cycle, and state administrative costs have been shifted to counties without any county control. In addition to aid reductions and cost shifts, the State’s recent teacher pension shift sends to counties massive new costs that lie completely outside the county government’s management.

Although the State continues to face long-term funding challenges to meet its spending commitments to education, Medicaid, and general government – the State’s fiscal situation clearly remains stronger than that of its counties, whose reliance on property taxes lags behind the overall economy. MACo urges State policy makers to restore eclipsed funding, ease financial burdens of prior costs shifts, and reinforce capital commitments to schools and other county priorities. The State should resist creating any further burdens on county budgets, local services, and their constituents.

MACo will continue to review and digest the emerging details of the proposed FY 2014 budget.

Michael Sanderson

Executive Director Maryland Association of Counties

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