BERLIN – The major revenue gap expected for Worcester County next fiscal year will not be covered by the departmental cuts already requested by the county, one elected official said this week.
“That is not going to solve the problem,” said Worcester County Commissioner Virgil Shockley. “It won’t come close … that’s just a starting point.”
While revenue numbers are still estimates, and the county is waiting for word on potential state cuts, department heads have been asked to cut 10 percent from their budgets for fiscal year 2011.
Shockley estimated that the 10-percent cut would only cover 25 percent of the budget gap, if current estimates hold.
“You’re going to have to make other drastic measures,” he said. “The 10-percent cut is for materials. It has nothing to do with personnel salaries or anything else.”
County revenues are expected to drop substantially for 2011, with the re-assessment of the Berlin and Ocean Pines areas reducing property tax income, and the recession causing unemployment and salary cuts which reduce income tax revenue. The reduction runs into the millions. Shockley estimated the amount lost could reach between $4 million and $6 million.
Some Worcester County departments, instructed last year to cut 3 percent, cut substantially more, which could leave them nothing left to cut this year, Shockley said.
“You have departments I don’t think that are going to be able to cut 10 percent of what they had last year because they cut to the bone,” Shockley said.
The county will have to be as efficient as possible, Shockley said.
“I’m sure there’s going to be some services cut,” said Commission President Bud Church. “Nobody’s going to be singled out.”
Some unquestioned expenses might have to be looked at more seriously, Shockley said, saying that the schools might have to live with larger class sizes, for example.
The county will be watching the Maryland General Assembly carefully this session, with several proposals to modify or waive the Maintenance of Effort school funding law floating around. Maintenance of Effort requires counties retain at a minium the same per-pupil spending as the year prior.
“It looks like there’s going to be a major push to change Maintenance of Effort,” Church said. “I don’t think we’re going to know ‘til the last week of the session what’s going to happen.”
Raising taxes is not a possibility, Shockley felt.
“Nobody wants to raise taxes,” Church said.
The county cannot raise the homestead tax credit to generate more revenue, as that can only be adjusted the prior October.
“We don’t want to do furloughs. We don’t want to do lay-offs,” said Church. “I would rather cut services than cut people, but nothing has been decided.”
The county also has to find a way to plug a $1.5 million hole in the current year budget, which still has six months to run, and that hole could get bigger, Shockley said.
The current year gap could be taken care of if the county can get back the $1.1 million it has set aside to pay a possible legal judgment against the Worcester County Board of Education stemming from a lawsuit with a contractor. That matter is currently on appeal.
The state is the wildcard in the county budget process. Last year, the state took $1.5 million from the health department. This year, county elected officials fear the state will push off responsibility for some pensions off on the counties.
“It’s going to be an interesting year,” said Church. “It’s going to work out. I’m an optimist.”