County Council Poised to Approve FY19 Operating and Capital Budgets
Last week, the Montgomery County Council reached a preliminary agreement on the County’s $5.6 billion Fiscal Year 2019 Operating Budget, the FY19 Capital Budget and the FY19-24 Capital Improvements Program (CIP).
The Council agreed on a $4.5 billion FY19-24 CIP to fund school construction, infrastructure improvements and community projects. The operating budget fully funds Montgomery County Public Schools and supports Montgomery College, the County’s Police Department, the Fire and Rescue Service and essential health and human services programs.
As the Germantown Pulse, reported last week, the Council agreed to add more than $6.6 million to the operating budget to maintain existing service levels and to minimize call response times for residents during emergencies.
The budget agreement also meets the FY19 target for the County’s reserve—9.4 percent of adjusted governmental revenues. Funding for this financial obligation helps the County retain its AAA bond rating.
“Today we have reached agreement on the County’s FY19 Operating Budget and the FY19-24 Capital Improvements Program. Working together, we have produced a budget that is restrained and responsible, does not raise taxes, and ensures the County will continue to provide the superb services that so many of our residents appreciate so much,” said Council President Hans Riemer.
“I credit the County Executive with making many great decisions in his budget, including fully funding Montgomery County Public Schools, which was also my highest priority. Among many changes, the Council was able to restore $6.7 million in proposed cuts to the Fire and Rescue Service, resulting in no cuts to Fire and Rescue, expand after school programs, expand pre-K, and shore up key safety-net services.”
He went on to say, “In the capital budget, despite reducing our overall borrowing level, we increased funding for school construction, shifted transportation funding to transit and bike and pedestrian infrastructure, and added an exciting new project - a new facility for STEM learning and innovation for kids, in partnership with KID Museum and the City of Rockville. I thank my colleagues for their support and dedication to working together.”
Council President Hans Riemer, Vice President Nancy Navarro and Councilmembers Roger Berliner, Marc Elrich, Nancy Floreen, Tom Hucker, Sidney Katz, George Leventhal and Craig Rice unanimously supported the operating budget agreement. Councilmembers’ budget statements and video clips of their remarks can be found here.
A final Council vote on the FY19 Operating Budget and FY19-24 CIP is scheduled for Thursday, May 24. The budgets will go into effect on July 1. The Council’s final budget resolutions will be posted tomorrow , May 24 on the County's Budget Website.
The County’s $4.5 billion six-year capital budget will provide funding to address the County’s most urgent building needs. The Council agreed to $1.8 billion over the next six years for Montgomery County Public Schools’ CIP. The Council reallocated/added $34 million from the approved CIP for school construction including funding for Lee Middle School to stay on the schedule proposed by the Board of Education with completion by September 2021 and planning funds for Dufief Elementary School in FY19.
The County’s FY19 operating budget will include tax-supported expenditures of $4.8 billion and approximately $672.2 million in non-tax supported expenditures. The budget reflects a property tax rate of 98.14 cents per $100 of assessed value, which is 1.98 cents below the current rate. The budget includes a property tax credit of $692 for homeowners whose properties are their primary residences. The annual bill for the average homeowner will increase by $27. With these actions, property tax revenue did not exceed the “Charter Limit” on real property tax revenue.
The approved budget also meets the FY19 target for the County’s reserve—9.4 percent of adjusted governmental revenues.
Montgomery County Public Schools
More than half of the County’s budget, $2.59 billion, will fund Montgomery County Public Schools (MCPS). This amount will fully fund the budget request from the Montgomery County Board of Education. This represents an increase of $77.2 million or a 3.1 percent increase from the FY18 approved budget and is $18.6 million more than the required Maintenance of Effort level, which is mandated by the State of Maryland. This includes a local contribution of more than $1.7 billion.
The County continues to rank near the top of all Maryland jurisdictions for total per pupil funding. The Montgomery County Board of Education estimates that 163,184 students will attend MCPS in FY19. This will be 1,714 more students than last year. The FY19 funding will provide for an additional 152.7 full-time employees over the approved FY18 level, for a total of 22,452 employees including 91 new teachers. A total of $60.4 million is allocated for the County’s contribution to the State retirement fund for teachers.
The FY19 MCPS budget request maintains or enhances several important programs. Some highlights include:
• maintaining the class-size reductions approved by the Council in FY17;
• expanding needed prekindergarten programs;
• maintaining funding approved by the Council last year to expand Head Start programs from half-day to full-day;
• expanding two-way immersion dual language programs to three additional elementary schools;
• increasing counselor and psychologist positions to address the physical, psychological and social well-being of students; and
• adding new career pathway programs for high school students.
County funding for Montgomery College in FY19 will be $316 million, with $750,000 added by the Council to help fund compensation and benefit increases for College employees. County funding for the College is above the required Maintenance of Effort level for the seventh year in a row. The FY19 Montgomery College budget will maintain and enhance several key programs designed to increase access, ensure student success and maintain affordability. The College’s budget assumes a tuition increase of 2.9 percent by increasing per semester hourly rates as follows: $4 for in-County students, $8 for in-state students and $12 for out-of-state students.
The operating budget for the Department of Police will be $279.9 million. This is a 1.6 percent increase from last year’s budget. Two police candidate classes are included in the budget with a total of 44 candidates to address attrition. The Department of Police budget also includes funding to expand the criminal gang unit, next generation 911 service, funding for the School Bus Camera Program, crossing guards for Richard Montgomery Elementary School and compensation adjustments. The Council also added funding for one vice unit detective ($60,992) and three school resource officers to staff middle schools ($182,947). The Council also agreed to fund a body camera program for the Sheriff’s Office ($229,903).
The operating budget for the Fire and Rescue Service will be $217.4 million. This is an increase of 1.2 percent from FY18. The Council restored the following items to the Fire and Rescue Service budget to maintain existing service levels and to ensure that response times for residents during emergencies are kept to a minimum: restore engines at the Hyattstown ($2.4 million) and Germantown Stations ($1.7 million); restore an aerial tower at the Hillandale Station ($1.5 million); add four full-time positions at the Burtonsville Station ($674,930); add $88,000 to fund the Bethesda Chevy Chase Rescue Squad; and restore Emergency Management Services transport funds to Montgomery County Volunteer Fire and Rescue and the Local Volunteer Fire Departments ($114,780).
The Council has agreed to fund more than $5 million in FY19 to support the work of the Montgomery County Economic Development Corporation (MCEDC). This organization implements the County’s economic development strategic plan, which includes marketing, business attraction and retention, entrepreneurship and promoting the County’s economic base.
The Council also agreed to allocate $1.8 million in funding for WorkSource Montgomery, which implements the County’s workforce development policies to promote job growth and attract talent.
In addition the Council agreed to fund more than $3.5 million for the County’s incubator programs. This includes funding for BioHealth Innovation, which identifies market-relevant biohealth products and connects those products with funding and assists business development and growth, and the Wheaton Small Business Technical Assistance Program. The Council also added $425,000 to fund a Small Business Innovation Research Matching Program.
The budget includes $1.5 million, from the County’s hotel/motel tax, to fund the County’s Conference and Visitors Bureau, which promotes and markets the County as a destination and provides information to County visitors.
The Council agreed to fund the Department of Transportation’s budget at more than $217 million. This includes funding for items like road maintenance, leaf collection, Ride On and the parking lot districts. The Council’s budget agreement includes funding to begin to pilot bus service on Route 52 between Olney and Rockville. This new service will use microbuses to broaden the service area within Olney’s neighborhoods, including Olney Mill, Longwood and Brookeville.
The Council also agreed to provide funding for bus service between several points in Clarksburg and the Germantown MARC station starting in January 2019. In addition the Council agreed to fund $100,000 to restore signal timing optimization to help keep traffic moving.
Children, Youth and Families
Continuing the Council’s commitment to funding early childhood education and prekindergarten programs, the Council agreed to fund $86.6 million for children, youth and family services. The combined total for Head Start and prekindergarten programs in the Department of Health and Human Services (DHHS) and MCPS is $76 million. This includes new funding in FY19 of $2.5 million for a new early childhood center, additional prekindergarten classes and summer school classes for prekindergarten.
The Council added $877,944 to expand part-day prekindergarten services to full-day at eight schools, which is consistent with the Council’s prior actions to expand full-day prekindergarten slots. The Council also agreed to fund more than $4 million for early childhood services. The Council also added $25,000 for Montgomery Housing Partnership’s GATOR afterschool enrichment program, which will be administered by the Department of Housing and Community Affairs.
Health and Human Services
The Council has agreed to fund $318.5 million for the Department of Health and Human Services. This is a 1.8 percent increase from last year’s approved budget. The Council agreement will fund 1,425 full-time positions and 342 part-time positions. The Council recommended several service enhancements to provide additional safety-net services for residents including:
• $979,272 to provide increases to nonprofit contracts providing health and human services.
• $246,500 for a Youth Drop-In Center for young people who are experiencing homelessness.
• $68,700 for Care for Kids Program.
• $158,000 to provide 2,000 primacy care visits, $25,500 to restore psychiatric services and $50,000 for specialty care through Montgomery Cares.
• $113,400 to provide funding to increase the reimbursement rate for Montgomery Cares by $1.50.
• $135,308 to convert four contract positions in the Asian American Health Initiative (AAHI) and four contract positions in the Latino Health Initiative (LHI).
• $316,844 to fund the Developmental Disability (DD) Supplement at an amount that will allow providers to pay up to an average of 125 percent of the County’s minimum wage to direct service workers.
• $65,320 for one position in the Long-Term Care Ombudsman Program because of the growing number of facilities.
• $80,000 to, and shift funding allocated for, the Tree House contract to restore a community health nurse in DHHS Child Welfare Services to be assigned to the Tree House.
• $60,000 to continue to increase the number of elementary school children who receive weekend food bags, otherwise known as SmartSacks.
• $30,000 to fund mini-grants to assist organizations that are recovering and/or distributing food.
Community Grants and Working Families Income Supplement
The Council has agreed to fund more than $12.37 million for 249 different grants to nonprofit community partners that provide essential services for County residents. This amount includes the grants recommended by the County Executive. View the full list of FY19 Council Approved Grants.
The County’s budget will fund $23.3 million for the Working Families Income Supplement Non-Departmental Account, which provides funds to supplement Maryland’s Earned Income Tax Credit (EITC) and is intended to benefit low-income working families in the County. The federal government authorizes the federal EITC for working people with low- to moderate-incomes. The County supplements the State’s refund by 100 percent for County residents, in effect doubling the amount received.
The Council has agreed to fund a total of $63.8 million for the Housing Initiative Fund for affordable housing. This includes both funding appropriated to the operating and capital portions of the Housing Initiative Fund (HIF). The Council added $6 million to the capital appropriation to increase the preservation and production of affordable housing. The HIF also includes funding for the Building Neighborhoods to Call Home Program and the Inside (Not Outside) Initiative to end homelessness. The Council also agreed to a $17.3 million cap for the Payment In-Lieu of Taxes Program that helps promote the construction of affordable housing throughout the County.
The County continues to work to achieve the goal of reaching functional zero for chronic homelessness. Since January 2016, 363 chronically homeless people have been placed in housing.
The Council agreed to fund total expenditures of $38.8 million for the Recreation Department. This is an increase of more than $1 million from last year’s approved budget. The Council added funding for several service enhancements for the Recreation Department to improve facilities maintenance and enhance services for residents, especially those focused on positive youth development. Some of the enhancements include:
• $53,826 to extended hours at the Mid-County and White Oak Community Recreation Centers.
• $30,000 to restore grounds maintenance.
• $50,000 to restore furniture, fixtures and equipment.
• $70,000 to restore janitorial and custodial services.
• $397,318 to fund two new Excel Beyond the Bell Elementary Program sites.
The Council agreed to fund $109.9 million for solid waste services in the budget of the Department of Environmental Protection (DEP). This is a $13.4 million or a 13.9 percent increase from last year’s approved budget. Most of the increase is for trash and recycling collection contract costs, reduced energy revenue at the Resource Recovery Facility, capital equipment costs, increased out-of-County trash hauling and increased contractual costs. The Council concurred with the County Executive’s recommended increase in the refuse collection charge from $70 to $77.
The Council agreed to fund $30.7 million for the non-solid waste portion of DEP. This includes expenditures for the General Fund and the Water Quality Protection Fund (WQPF). Overall the WQPF is 91.1 percent of DEP’s total budget and covers County costs associated with water quality and the inspection, maintenance and rehabilitation of stormwater management facilities.
The Council reviewed the CIP for the Conservation of Natural Resources - Stormwater Management and recommended the same level of expenditures as the County Executive, $102.5 million. This is a decrease of $243 million or 70.3 percent. Expenditures are down substantially reflecting less capital work expected to be required over the next six years to meet the County’s next National Pollutant Discharge Elimination System-MS-4 permit.
While supporting the same level of expenditures as the County Executive, the Council did not support the Executive’s recommendation to move forward with a five-year comprehensive design/build/maintain contract for 530 impervious acres of retrofit work. Instead, the Council supports the Department of Environmental Protection meeting its expected future MS-4 permit requirements by using existing contract mechanisms to complete work already under design.
The Council agreed to support the County Executive’s recommendation to keep Water Quality Protection Charge rates at current levels for the upcoming fiscal year. The Council also agreed to provide $48,508 to fund a program manager position in the Office of Sustainability for half of FY19.
Park and Planning
The Council has agreed to fund $153.6 million for the Maryland-National Capital Park and Planning Commission (M-NCPPC), excluding the capital projects fund. This is more than a 3.5 percent increase from last year’s approved budget. Included in this amount is more than $107 million to enhance and maintain the County’s park system, which includes 419 parks and more than 36,800 acres of land. The Council agreement funds $200,000 to create urban parks through placemaking and $343,995 to provide service for new and expanded parks across the County.
The Council agreed to fund $42.8 million for the Department of Public Libraries. This amount is a slight increase from FY18. The budget maintains the same public service hours for all branches.
Washington Suburban Sanitary Commission
The Montgomery and Prince George’s County Councils, on May 10, reached budget agreements for the Washington Suburban Sanitary Commission (WSSC), the bi-county portion of the Maryland-National Capital Park and Planning Commission (M-NCPPC) and the Washington Suburban Transit Commission (WSTC). WSSC’s FY19 Operating and Capital budgets total $1.4 billion. The new budget includes a 4.5 percent rate increase for WSSC water and sewer customers. All new bi-county spending plans are effective starting July 1, 2018. The 4.5 percent rate increase will add $2.04 per month to a household with average consumption (143 gallons per day).
The Council unanimously approved a two percent general wage adjustment and service increments of 3.5 percent in each collective bargaining agreement negotiated by the County Executive for FY19. Pursuant to the agreements with the Fraternal Order of Police (FOP), Lodge 35, and Local 1664 of Montgomery County Career Fire Fighters (IAFF), the general wage adjustment will take effect on the first pay period after July 1, 2018.
The general wage adjustment in the Municipal and County Government Employees Organization of the United Food and Commercial Workers, AFL-CIO (MCGEO) agreement will take effect on the first pay period after Dec. 1, 2018.
In addition to these wage adjustments, the FOP, IAFF and MCGEO also will receive longevity awards. The Council approved a $1,000 lump sum award in the FOP agreement for eligible unit members who had a service increment deferred in FY12 and/or FY13 on the first full pay period following July 1, 2018.
Studies & Design Work
The Council has agreed to fund a benchmarking study on racial and social disparities in the County through the Office of Legislative Oversight. The goal of this study is to create an equity policy framework for County government to help eliminate disparities.
The Council also agreed to provide funding for an airspace consultant to develop alternative flight path recommendations for negotiations with the Federal Aviation Administration to reduce aircraft noise in the southwestern portion of the County.
In addition the Council provided $60,000 for a student loan refinancing market study and cost analysis.
The Council added $250,000 to the Administration Fund for M-NCPPS to fund various studies and consulting work.
The Council also added $32,300 for design work for potential façade and other improvements in the Glenmont commercial area.