Leggett's sound budget
Systemic change needed for long-term viability
The hundreds of millions in expense reductions that Montgomery County Executive Isiah Leggett has proposed in his fiscal 2011 budget are necessary and well-reasoned.
Leggett has crafted a fiscal plan that addresses the revenue shortfall from an economy in search of recovery and has begun planning for a future filled with uncertainty due to federal and state budgets that struggle to live within their means and add to the financial pressures of local jurisdictions.
Leggett's $4.3 billion budget reflects reorganizations within the Department of Correction and Rehabilitation (a $3 million reduction to $62.5 million), the Department of Public Libraries (an $8.5 million reduction to $29.3 million), and the Recreation Department (a $4.5 million reduction to $26 million). The budget also calls for consolidating staff who serve the Ethics Commission and the County Attorney's Office, and shifting the Equal Employment and Diversity Management Office from the Office of Human Resources to the Office of Human Rights.
Cuts include eliminating 450 positions (230 of which are filled), reducing the reserve fund from 6 percent to 5 percent and deferring funding for retiree health benefits, a potentially worrisome decision.
Leggett is also seeking additional revenue through an increase to the energy tax that will cost the average homeowner about $3 per month, and the implementation of ambulance transport fees. If the County Council approves these measures, it could mean an additional $65 million per year in revenue. In all, Leggett has managed to fill a $780 million hole a major accomplishment considering what he had to work with.
"To those who may object to these reductions, I have a simple message: I do not like these any more than you do. Hard choices must be made, and not just talked about, in this difficult economic and fiscal environment," Leggett wrote in his budget message.
He's absolutely right.
But he and the County Council still have a lot of work left.
While there are signs that the nation's economic picture is beginning to improve, the taxes that support local governments tend to lag behind many of those indicators. That means county residents are going to have to endure budget pain for some time. County Council President Nancy Floreen notes that budget gaps for the next five years are estimated to exceed $212 million, $303 million, $417 million, $464 million and $514 million. To address this problem, Floreen has called for an assessment of the deficits to be conducted by the Office of Legislative Oversight and delivered by December. The study will offer options to address the shortfalls.
Few question county budget director Joe Beach's recent comments to the Washington Post that "the pressure to spend is always going to be a lot more than the pressure to reduce."
Politicians, residents, unions and employees all have motivation to increase services. The voice of restraint, especially since the council lost fiscally cautious members Marilyn Praisner, Betty Ann Krahnke and Nancy Dacek, has been somewhat diminished. Council member Phil Andrews has been a consistent voice in arguing against unnecessary spending, questioning the generous pay and benefit packages in union contract negotiations. Leggett himself warned as he came into office that some of the financial decisions in the county were unsustainable.
Looking ahead, if there is a time to implement broad changes to government, it is now. More than ever, the public seems to understand the depth of the problems (60 percent of respondents in a 2009 county survey said the economy has had a negative impact on their household income). This recession has reset the "normal" level for America. Montgomery County is no exception.