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County Facing $140M Shortfall for Fiscal 2012 | News

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County Facing $140M Shortfall for Fiscal 2012

The Gazette reports that Montgomery County has a $145 million budget shortfall that officials already have identified for fiscal 2012, which begins next July.

On Tuesday, county officials told the County Council that known expenditures will be 4.3 percent higher in fiscal 2012 than this year. A fiscal plan approved by the council earlier this year allows for growth of one-tenth of one percent.

To help curb government expenses, County Executive Isiah Leggett (D) has directed all county agencies to prepare to trim their budgets by as much as 15 percent. County spokesman Patrick K. Lacefield said such a scenario might not even be the worst case if decisions during the next Maryland General Assembly session, which begins in January, transfer more state expenses — such as teacher pensions — to county government.

"Asking departments to continue to cut around the edges is never going to get us to where we need to go," said Council Vice President Valerie Ervin (D-Dist. 5) of Silver Spring.

She said the primary expenses in the county are employee salaries and benefits, which make up 80 percent of the county's tax-supported budget. The county has an operating budget of about $4.3 billion.

Joseph Beach, the county's director of Office of Management and Budget, said that about half of the county's expected $145 million shortfall in fiscal 2012 comes from an anticipated increase in funding for Montgomery County Public Schools.

If the county is required to fund maintenance of effort — which it has avoided the past two fiscal years — it will cost more than $70 million, he said. The remaining increases come from reinstating the unpaid leave county workers were forced to take this year and expenses the county delayed in the current fiscal year, such as the purchase of vehicles.

The council filled a $1 billion budget shortfall in fiscal 2011, which began in July.

Beach said that current budget numbers are preliminary, adding that more details will be provided in November, when the county receives some tax revenue numbers from the state.

The council should consider that the county will face additional budget trouble in fiscal 2013 when increases to the county's energy taxes — approved this year — will sunset, Beach said.

Council President Nancy M. Floreen (D-At large) of Garrett Park said Monday that it was too soon to know if furloughs and layoffs, which were implemented this year, will be necessary in fiscal 2012.

On Tuesday, Beach said that Leggett is not considering tax and fee increases at this point.