Leopold's Shell Game

Leopold's Shell Game

The last several years have been tough ones for Anne Arundel County.  Under County Executive John Leopold, we have been living beyond our means.  In fiscal years 2009 and 2010 combined, the county is projected to spend $150.6 million more than its revenues:

Anne Arundel County Overspending ($ Millions)
(including State Grant Funding)

 

2009 Est.

2010 Budget

2009 + 2010

Revenues

$1,172.7

$1,110.5

$2,283.2

Expenditures

$1,227.9

$1,205.9

$2,433.8

       

Overspending

($55.2)

($95.4)

($150.6)

Since the county is required to balance its budget, you are probably asking how this is possible.  The answer is that Mr. Leopold has been cleaning out the reserve and capital funding accounts in lieu of making the tough decisions to significantly cut spending or increase revenues. 

During these two years, Mr. Leopold has spent $134.9 million in reserves carefully built up over previous years.  This is akin to you or I spending the family checking account down to its last few dollars.  You can do it, but you know you shouldn’t because you will need that money to cover your mortgage next month.

End of Year Fund Balances ($ Millions)

 

6/30/08

6/30/10

Difference

General Fund:

 

 

 

   General Fund 

$54.4

$0.0

($54.4)

   Revenue Reserve Fund

$47.8

$33.1

($14.7)

Total General Fund

$102.2

$33.1

($69.1)

       

Board of Education:

 

 

 

  Health Insurance Fund

$16.9

$0.6

($16.3)

  All Other Board of Educ.

$15.8

$5.2

($10.6)

Total Board of Education

$32.7

$5.8

($26.9)

       

County Health Ins. Fund

$12.9

($5.8)

($18.7)

Water/Wastewater Funds

$115.5

$111.6

($3.9)

All Other Funds

$56.9

$40.6

($16.3)

       

TOTAL

$320.2

$185.3

($134.9)

Among other things, Mr. Leopold stripped $15 million from the Health Insurance Fund earmarked for future retiree benefits.  He also spent $16.3 million in health insurance benefits owed to teachers. 

Not paying for any capital funding from the general fund is another way Mr. Leopold is shortchanging future taxpayers.  As recently as 2008, the county used $72.9 million from current tax revenues to pay for county improvements.  In 2010, however, every road widening or new baseball field  light is being paid for by going further into debt.   And Mr. Leopold even transferred $26.7 million previously committed for capital spending back into the general fund!

These are not savings.  Mr. Leopold is doing a shell game to trick county residents into thinking he’s being a good steward of our tax dollars. 

Mr. Leopold claims to have cut 2010’s spending by 8.8% for all departments other than the Board of Education.  Unfortunately, this claim is misleading.  The bulk of the savings result from not funding any capital investment this year from the general fund. Non-capital, non-Board of Education budgeted spending for 2010 is down only 3.3% from last year’s budget. And compared to what the county actually spent in 2009, 2010 spending is projected to increase by 0.6%!

Anne Arundel County Spending ($ Millions)
(includes State Grant Funding)

 

2009 Budget

2009 Est.

2010 Budget

 

Vs. 09 Budget

Vs. 09 Estimate

Board of Education

$584.6

$584.6

$592.1

 

+1.3%

+1.3%

Pay-Go Capital Funding

$32.9

$32.9

$0.0

 

-100%

-100%

All Other Operating

$634.6

$610.4

$613.8

 

-3.3%

+0.6%

             

TOTAL SPENDING

$1,252.1

$1,227.9

$1,205.9

 

-3.7%

-1.8%

Our citizens rely on the services Anne Arundel County provides, and no one wants to cut programs.  Having spent 2008 restructuring a real estate education company so it could break-even on 25% of the previous year’s revenues, I’ve learned there are often large savings that can be found by taking a hard look at overhead costs.  Does the County really need to pay $1.9 million for outside professional services for the Office of Information Technology in Fiscal Year 2010?  Is it possible to save some of the $4.1 million budgeted to be spent county-wide for phone and other communications services?  How about the $20.7 million for vehicle expenses and $2.7 million for uniforms? 

We need a County Executive who finds long-term solutions to our fiscal challenges rather than just raiding the piggybank.  Now that the reserves are almost gone, it will be incredibly difficult to avoid widespread program cuts in 2011 unless the economy miraculously recovers.  When the federal stimulus money disappears in 2012, balancing the county’s budget is going to be even more difficult. 

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