Council Makes 70% Reduction in 15.6% Tax Increase Proposal
Adds $34 Million to Board of Education Budget, Implements New Fiscal Accountability Measures
The Prince George’s County Council adopted a $2.95 billion balanced County Budget for Fiscal Year 2016 during session on Thursday, May 28, 2015. The budget becomes effective with the new Fiscal Year which begins July 1, 2015.
Prince George’s County Council Chairman Mel Franklin (D) – District 9, during remarks immediately following the budget adoption, noted the challenges of a difficult budget season and thanked residents for their active participation in the budget process.
“This has certainly been a trying budget season, perhaps one of the most challenging in our County’s history. Consistent throughout our budget debates, however, has been a strong and passionate commitment to the future and promise of Prince George’s County. The active participation of our residents in the Council’s budget process has been a critical factor in our decision-making, and represents a tremendous source of pride for our County. This Council works for you, and we have been mindful about the sensitivity and passionate views surrounding this year’s budget. We will always be a body that listens, leads and looks out for County residents, and we have listened to everything you said as we considered this final budget.”
The FY 2016 County Budget adopted by the Council reduces the proposed 15.6% increase in property taxes in the County Executive’s budget to 4%, and invests $34 Million in additional Board of Education funding for Prince George’s County Public Schools (PGCPS), an amount directly tied to the unfunded mandate adopted by the State of Maryland in 2012 which shifted state teacher pension costs – approximately $30 million in Fiscal Year 2016 and $42 million in Fiscal Year 2017 – to Prince George’s County.
“While we appreciate the boldness and aggressiveness of the Prince George’s County Public Schools’ Strategic Plan and the County Executive’s proposed 15.6% tax increase to pay for it, the County Council collectively determined that a 15.6% increase in property taxes is unaffordable for the working families of Prince George’s County,” said Chairman Franklin.
The County Council and the school system will proceed with an outside performance audit of the school system for the first time in 18 years to study how existing tax dollars are spent, and recommend potential cost-savings in existing programs. In addition, the audit is designed to increase confidence among constituents in the County school system. The audit is scheduled to begin this summer.
Council budget action also averted proposed furloughs and layoffs for County employees during FY 16.
“We value our workforce and the critical services County employees provide. The Council will safeguard the level and quality of those services, especially for public safety. Council-initiated spending control measures applied across all agencies approved in the FY 2016 Budget generate $14.86 million in cost-savings to eliminate proposed layoffs and furloughs,” said Chairman Franklin.
The newly-adopted spending plan includes additional public safety classes and a commitment to heightened oversight of public safety agencies for better management of overtime spending. Additionally, to address the County’s longstanding structural deficit and related fiscal challenges, the County Council will adopt a spending control measure that requires each non-education County agency to reserve 2% of their operating budgets and $6 million of their overtime budgets in a contingency reserve fund. This will enable the Council, as the County’s fiscal authority, to provide greater assurance that County Government does not exceed the approved budget and to provide for funding to address any fiscal emergencies during the fiscal year.
In further action, the Council presented CB-33-2015, legislation to reserve half of future MGM National Harbor gaming/tax revenue, up to $25 million annually, for education spending. This includes Pre-K through 12 education, Prince George’s Community College, Prince George’s County Memorial Library System. “During the referendum debate on bringing gaming to the County, our residents were told that this new project would generate revenue, in large part, for education. This legislation makes the County Government fiscally accountable for that commitment,” said Chairman Franklin.
The Council also introduced CR-26-2015, which creates a Blue Ribbon Commission to address Prince George’s County’s structural deficit. The panel will propose policies to the Council and County Executive in the next year to address the imbalance caused when normal government spending exceeds County tax revenues on an annual basis. The commission will be comprised of residents and stakeholders with expertise in budget, finance and public policy.
In bi-county budget action earlier this month, lawmakers from Prince George’s and Montgomery counties unanimously adopted the FY 16 Operating and Capital budgets for the Washington Suburban Sanitary Commission (WSSC); the Central Administrative Services (CAS) budget of the Maryland-National Capital Park and Planning Commission (M-NCPPC); and the budget for the Washington Suburban Transit Commission (WSTC). The Councils approved the WSSC FY 2016 operating and capital budget of $1.3 billion, which includes a 1.0-percent rate increase for water and sewer customers.
In order to support and sustain many of the County’s existing critical public recreation projects, the Council has authorized a one and half cents rate increase, half of what was requested, for the Maryland-National Capital Park and Planning Commission, which is also facing a structural deficit of recreation and planning expenses exceeding revenues on an annual basis. This will require tight management of spending for planned new recreation projects and planning administration.
For a summary of Council adjustments in the adopted FY 2016 Budget, please click HERE