Ocean City To Hold Budget Sessions In Virtual Format

Ocean City To Hold Budget Sessions In Virtual Format
File photo by Chris Parypa

OCEAN CITY — Next week marks the time resort officials head into crucial budget deliberations for the coming fiscal year and that won’t change despite the ongoing crisis, but the process certainly won’t be typical.

In a normal year, the process begins with a balanced budget and a recommended tax rate presented by City Manager Doug Miller and Budget Manager Jennie Knapp. After that introduction, each department makes a lengthy pitch including power point presentations outlining all they have accomplished in the current fiscal year and what they are seeking in the pending budget. Finally, a budget wrap-up is held and final adjustment are made before a final budget is drafted and ultimately vote upon.

That process will begin as planned next week, but it won’t look like a typical year. There will still be public access to the budget process, but the sessions won’t be held in person at City Hall. Instead, Miller and Knapp will be based in a conference room in City Hall while the Mayor and Council will tune in remotely from home or their respective offices, for example.

The public will be invited and encouraged to participate in the process as usual, but will also have to do so remotely. On Thursday, resort officials worked out a plan to conduct budget sessions remotely and more details on how the public can tune in will be provided when they become available.

Meanwhile, Miller said on Thursday a proposed fiscal year 2021 budget has been completed and will be presented to the Mayor and Council and the public on Tuesday, albeit in a virtual format. Miller said Knapp has been working diligently on a proposed balanced budget even before the pandemic situation arose in recent weeks.

“Even before this virus situation, we we’re working on a condensed timeframe for the budget process because many of our members attend the National Hurricane Conference during this same time period,” he said. “Jennie has been working on holidays and weekends and staying late at night to prepare the budget. We are ready to present a balanced budget at the constant yield tax rate.”

Of course, that proposed budget was largely prepared before the coronavirus outbreak and all of the uncertainty that comes with it. Miller said he and Knapp also have a Plan B of sort that attempts to take into account the ramifications of a prolonged pandemic situation.

“We have a pre-COVID-19 budget we’re ready to present,” he said. “We’re also going to present a balanced budget with contingencies if this situation lingers and changes are needed. It might come down to some things being delayed or not done.”

While the current situation is unlike any ever seen, there is at least some framework available for budget contingencies. Miller said Knapp has reviewed how the town handled a severe economic downturn during the last major recession.

“Jennie has done an analysis of some of the situations the town faced during the recession in 2008,” he said. “She has come up with an alternative plan for this current situation using some of that analysis.”

The post-virus situation could unfold one of two ways for resort towns such as Ocean City. Visitors could be so tired and frustrated by prolonged self-distancing and staying at home that they come to the resort in droves when the crisis is over, or they are so financially devastated by the crisis that vacations are down low on the priority list. Miller said town officials are hoping for the former but planning for the latter.

“If we’re back completely in business by Memorial Day and go into June strong, there is still a lot of uncertainty,” he said. “The financial impact of this is still unknown. A lot of people are taking a huge financial hit from this and taking a vacation in Ocean City this summer might not be in the cards for them.”

It’s important to note the fiscal year ends on June 30 and the new fiscal year begins on July 1, so much of the economic losses associated with the current crisis will be felt in the last three months of this fiscal year. Miller said a plan is in place to handle that eventuality, but warned a prolonged crisis that lingers deep into summer could be tough to overcome.

“If we’re back to normal by Memorial Day and have a strong June, we’ll be okay,” he said. “If we go beyond that, there will definitely be some challenges. Room tax is a significant part of the town’s revenue and most of that is collected in June, July and August.”

Meanwhile, the Mayor and Council have not met formally in a public forum in about two weeks, but the regular sessions and work sessions will soon resume, albeit likely in a virtual setting for the time being.

“We have to continue going about the town’s business and the daily operations,” he said. “We can’t go neutral. We’re going to continue to have meetings although it might be in this virtual mode for a while.”

About The Author: Shawn Soper

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Shawn Soper has been with The Dispatch since 2000. He began as a staff writer covering various local government beats and general stories. His current positions include managing editor and sports editor. Growing up in Baltimore before moving to Ocean City full time three decades ago, Soper graduated from Loch Raven High School in 1981 and from Towson University in 1985 with degrees in mass communications with a journalism concentration and history.