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Prince George's County Executive Rushern L. Baker III (D) said he will continue a hiring freeze and streamline departments to address an anticipated $77 million deficit for fiscal 2012.

"Closing this gap will be a manageable challenge, but a difficult one," Baker said at a news conference Dec. 22 in Upper Marlboro.

The $77 million shortfall in meeting the county's projected fiscal 2012 costs of $2.701 billion was announced as Baker's budget staff finished a review of county finances and adjusted for new costs next fiscal year. Baker plans to present the county budget March 15, and the County Council must pass the budget by late June.

A $22 million increase for education funding and rising health care and pension costs account for large portions of the gap, said Thomas Himler, acting county budget director.

"It's a challenge, but we are going to manage with whatever resources we have," Himler said.

Other costs making up the gap include a $4 million increase in the $90 million the county pays on its debt each year; $9 million to pay for rising public safety costs; $7 million to train new classes of police, fire and possibly corrections officers; and $6 million more to fully fund the county hospital system, Himler said.

The deficit is greater than anticipated. A recent report released by Baker's predecessor, Jack B. Johnson (D), predicted the county budget would remain at its current $2.6 billion level next year.

However, Baker and budget officials emphasized the gap still is far less than in neighboring counties such as Montgomery, where officials are facing a deficit of more than $300 million.

"Prince George's County is in sound fiscal shape," Baker said.

Baker said "very low growth" in taxes account for costs going exceeding revenues. Tax assessments on county properties are falling, making the amount residents pay for property taxes lower.

The current projected deficit for fiscal 2013 is $133 million.

The budget currently calls for no furloughs or layoffs of workers, but continues a freeze on new hires put in place two years ago. Baker said he would make exceptions for county police and firefighters, but only to offset losses from retirement and attrition.

Baker said he doesn't intend to make cuts to the county's share of the $1.69 billion budget the school board submitted last week. Education costs are shared by the county and state, which funds about $1 billon of the school funding.

State funding is an undecided factor. State leaders have proposed having counties shoulder portions of the state's teacher pension system, over objections from Baker and other county executives.

The state's plans to shift pensions to the county could inflate Prince George's deficit to $105 million.

"I've met with the governor, and I've met with our delegation," Baker said. "I'm making it clear: The county needs every dollar it can [get] from Annapolis."

Baker, who ran for executive on promises to improve education and boost hiring in county police and fire services, conceded some of his goals are being put off because of the financial outlook.

"What's surprising is the complexity of the job itself," he said. "You think immediately you can get in and do a lot of things. But you can't."

Baker instead promised thorough reviews of county spending to find possible cuts, starting with creating CountyStat, a computer monitoring system that would help track performance of county departments.

"[CountyStat] will give us the ability to effectively measure services," he said.

Baker also said he plans to reduce the numbers of employee credit cards and take-home vehicles, two areas that have been scrutinized in the past.

Sometime after 2007, County Council members stopped getting credit cards after it was revealed in 2006 that leaders charged large amounts on personal items and travel. Baker was unable to say how many cards still are in use and said the county currently lets about 50 workers outside of police and fire service use government vehicles for travel.

Savings from those programs are likely to be minimal, said Douglas Brown, deputy chief administrative officer.

"Yes, you don't solve the deficit with that," he said. "But these are immediate actions that you can take."

Baker said the scrutiny will reassure residents.

"These can easily be abused," he said of the cards and cars. "It's something we want to pay attention to."

dvalentine@gazette.net