Prince George’s County expects to lose $134 million in local revenues as a result of the COVID-19 pandemic.
Prince George’s County Executive Angela Alsobrooks last week submitted to the County Council a revised fiscal 21 budget proposal in order to reflect a significant deterioration in local revenues due to the COVID-19 public health crisis.
Counties are making significant financial investments to address immediate public health and safety needs. At the same time, counties are experiencing massive and unprecedented declines in revenue as a result of the coronavirus pandemic.
The combined effect of these changes will likely undermine county revenue structures and support for education, public safety, roadway maintenance, and other essential services.
“When the FY 2021 Proposed Budget was presented on March 11, 2020, it was unknown at that time the COVID-19 pandemic could so quickly and significantly change the economic outlook of the world, country, and Prince George’s County,” Alsobrooks wrote in a letter to the Council.
“If you exclude the additional increase in the use of reserves, county source revenues decline $134.0 million or 4.8% below the original proposed budget. This is a significant deterioration of county source revenues that support our core services,” Alsobrooks said.
The County expects to lose approximately $86 million in local income tax revenue, $16 million in license/permit fees, $13 million in transfer and recordation tax revenue, and $10 million in investment income. Alsobrooks said the County will use $30 million in reserve funds to cover COVID-19-related expenditures.
According to a statement from Council Chair Todd Turner:
The County Council will continue its work with County Executive Alsobrooks and her budget team, County residents and all stakeholders, to ensure our County’s fiscal priorities are met, and address the community’s need for critical services and resources, in the review and adoption of the FY 2021 Proposed Operating and Capital budgets for Prince George’s County, as well as the budgets for two bi-county agencies – Washington Suburban Sanitary Commission and Maryland-National Capital Park and Planning Commission.
The revised budget seeks to offset severe revenue erosion; maintain core government services; manage the pandemic; implement significant spending controls; and retain the existing workforce with hiring and salary freezes. We agree however, with the County Executive, that we must closely monitor our revenue collections and overall economic trends for further threats to the County’s fiscal health.
As part of its Budget Review and Adoption Process, the Council will conduct its detailed review of the revisions to the Proposed FY 2021 County Operating Budget, sitting as the Committee of the Whole.
Virtual budget sessions begin on Tuesday, April 28th, and the Council will conduct two FY 2021 Budget virtual public hearings on Monday May 4th and Monday May 11th, which provide critical public input and comment. The Council began this week with virtual public hearings on two bi-county budgets for the Washington Suburban Sanitary Commission and Maryland-National Capital Park and Planning Commission.
The County Council has established an eComment portal to provides residents with an opportunity to participate in virtual Council sessions, and important budget public hearings, while adhering to social distancing guidelines. The portal enables residents to register electronically to speak on agenda items scheduled for a public hearing, or to submit a comment or letter into the official public record, in lieu of verbal testimony.
Budget meeting and public hearing schedules have been revised and may be further impacted by the coronavirus (COVID-19) public health emergency. To follow updates on the Revised FY 2021 Budget, visit the Council’s FY 21 Budget Portal.
The new Fiscal Year begins July 1, and pursuant to the County Charter, the County Council must adopt a new and balanced spending plan for Prince George’s County on or before June 1.
Useful Links
Previous Conduit Street Coverage: Running on Fumes: Impact of COVID-19 on County Finances
Previous Conduit Street Coverage: Comptroller Delivers Grim Economic Outlook Amid COVID-19 Crisis
Previous Conduit Street Coverage: Congress Passes COVID-19 Relief Package
Previous Conduit Street Coverage: Counties to Congress: Help Needed Here, On Front Lines
Previous Conduit Street Coverage: MD CARES Plan: $364M, Split Between Local Health and Local Govts
