Updated: May 28, 2020
Transcript: Anne Arundel County Executive Steuart Pittman's 2021 budget presentation to county council 11 AM 5/1/2020.
"Thank you Chairwoman Pickard, Vice Chairwoman Lacey and council members Pruski, Volke, Fiedler, Rodvien, and Haire for inviting me to present in my own words, even if, unfortunately not in person, our proposed fiscal year 2021 budget.
It's a 394 page document that, after your deliberations and amendments will determine how each department and county government can spend the hard-earned funds that our residents invest in an uncertain time. How some might ask, can we budget effectively when over 30,000 of our residents have just filed for unemployment? When businesses are closed.?When we're in the early phase of a battle against an enemy that is growing in strength?
'Pull yourself together.' That would have been the response from my father, a world war two marine combat veteran whose Pentagon job during the Cold War was to play in mass evacuations and sheltering in case of nuclear war. In other words, stop worrying about what you don't know. review what you do know and use that information to plan a path forward. Now, my son, place your two feet firmly on the ground, take one step forward at a time, keep listening. You may need to adjust your pace or your path, but get moving.
This budget is our path in uncertain times. So to look forward with confidence, we must know our history. During the last three decades, most of our local politicians believed that lowering taxes was the key to winning elections. They lowered the property tax rate 10% and move the income tax rate down to a level that was 22% below where all of the other big eight counties today, The fiscal impact of those rates put pressure on politicians to spur growth, any growth to generate government revenue.
The growth happened, but the costs of essential personnel and infrastructure were underestimated. Last year with strong revenue projections before us, we made a correction. For our schools, we added 140 teachers, 50 Special Ed instructors and 35 mental health positions. For our teachers, we funded a long overdue pay increase that began to restore the compensation that they had been promised in their hiring contracts. We added 50 new fire and emergency medical service positions, and have grown our ranks of sworn police officers by 88 in the last year
To establish and enforce consistent land use rules, we restored six previously-cut planning positions and hired for new inspectors. To make progress on our worst traffic bottlenecks and our school construction backlog. We created last year a new fund for permanent public improvements that will pay debt on 250 million in new long overdue projects.
To pay for this investment, we had to be strict with our taxpayers. We had to raise revenue. The good news is that both our income and property tax rates are still among the lowest in the state, and are far lower than all of Central Maryland's big eight jurisdictions.
Let's turn now to how we arrived at the budget before you .We started the process in January. With the same system we invented the year before--seven budget town halls, one in each council district and one and an online build your own budget tool. Then I asked each county department what they need to maintain services and how they could do better. Perhaps the most important part of the process is a comprehensive report from the budget office on the county's revenue projections.
On March 13. Our best estimates were as we expected, with a projected increase of $101 million over this year. Of that incremental revenue, we knew that about 57 million would be absorbed by non-discretionary expenses, like debt, service on capital projects, pensions, and legally-enforceable labor contracts.
On March 30, we received updated revenue projections, predicting that our 101 million dollar incremental revenue would more likely be $61 million based on the projected impacts of the corona virus pandemic.
And then on April 6, that figure dropped again to just $38 million--$19 million less than those non discretionary expenses.
The message was clear. This would be a year to do more with less
I want to thank the budget team not only for the extra hours, they put in scouring the budget for savings after each drop in revenue projections, but also for the role that they played in the final weeks of the process when my team and I debated the impacts of every cut, every investment, and every deferred improvement to county services that we wanted so badly to implement. You were patient with us, responsive to us, and when we were stuck, you helped us find a way forward.
And I particularly want to thank Jim Beauchamp, our new budget officer for a job well done on your first Anne Arundel County budget. I truly appreciate having the budget team led by a fiscal conservative, who understands that what we're doing is more than just math, that every decision we make is impacting lives.
And finally, I want to thank my leadership team, who came together at the end of this process to challenge me, challenge each other and protect the interests of the people they serve in this final proposal that we submit to our county council today.
I noted that a budget in uncertain times is a path. This budget is a difficult path. It required us to make some tough choices at the outset. We started with a decision to accept the revenue projections as presented. An easier path would have been to project optimistically, increasing the possibility that we would draw later in the year on our $80 million rainy day fund to pay the bills. We must do our best to protect that fund in this time of uncertainty.
Last week, I implemented a county hiring freeze. With exceptions for public safety and essential positions. vacancies will not be filled this year. With the exception of those whose unions negotiated labor contracts before the Coronavirus pandemic county employees will not receive merit or cost of living raises. Instead, we will pay a one time across the board pay supplement of $1500. Our lowest paid employees will get the same bonus as those at the top of the scale. Had labor negotiations been conducted in recent weeks, I suspect that the outcomes would have been different.
Very few departmental supplemental requests were approved this year. We made some exceptions for programs that had a significant impact on the health of our residents, or that generate efficiencies in operations. A tool that we chose not to use in this budget was an upward adjustment in the tax rates to compensate for a shrinking tax base.
Our property tax rate will drop ever so slightly from 93.5 to 93.4 cents as prescribed by our revenue cap. And our income tax rate will remain the lowest in the region at 2.81%.
Earlier this year, I proposed a bill at the Maryland General Assembly enabling counties to tax income according to wealth. That would have created a tool to provide relief to over 98% of our residents by taxing annual income over $500,000 at the same rate as our neighboring counties. Early adjournment prevented passage this year, but I will work hard to win this authority in the next session.
Our capital budget would most likely have been void of any new projects this year we're not for the new PPI fund that we created in last year's budget. That decision made it possible to keep the school construction plan on track to start work on the Harold Harbor and Cape St. Clair fire stations. To start on a much needed police forensic lab. And set aside capacity to match state funding for improvements on Route Two and Route Three corridors, thereby moving them up the state's priority list.
The budget also includes funding for the Brooklyn Park Cal Ripken Field complex, designed for the new Deale Community Park, and full funding for the new Anne Arundel Community College life sciences building, an extremely important investment in an institution that will play a pivotal role in preparing our workforce for the post-pandemic economy.
I'm particularly pleased to report the news from our federal delegation that long-awaited funds to renovate Meade High School have been approved, allowing that project to break ground as early as next spring. By next year, we will have a clearer picture of the long-term local revenue projections and the extent to which federal stimulus funds might be directed to infrastructure spending. We may also see some shifts in our priorities to reflect a possible trend from office work to telework, and other post-Coronavirus changes in lifestyle.
My last comment on capital spending relates to affordability. The last administration's final budget spent $73 million over the level established by our affordability committee. We've brought that number down in FY 20 to $59 million. And this year, we've reduced it to $28 million, a move that can only help as we defend our bond rating, and future years.
Let's talk now about our schools. Education is for the future. And I for one, refuse to let COVID-19 derail the work we are doing to prepare our kids for their future. The blueprint for Maryland's future is more important than ever. both state and county funding for education will be less than we had hoped during the pandemic and it's recovering, but as we build back better, we must not retreat from the goals we established to close the opportunity gap and create the best schools in the world. That is the key to our better and fairer economy.
Our school board sent us a well crafted and ambitious budget request before the impacts of COVID-19. were fully understood. The cost was $69 million over this year's budget. We can't deliver on that request. But we can get more than halfway there. With a package that is $35.5 million over last year, with 14.8 million of that being county funding.
Crofton High School will open this fall with 57 new positions. We will also bring on 84 new teachers to prevent enrollment growth from increasing our class sizes. Twelve new behavioral health positions to continue addressing that urgent need. And the one that all of us recognize to be critically important,76 new positions to work with our special needs kids. I don't know about you, but that warms my heart.
I had high hopes this year for teacher and support staff compensation. A plan to continue it back steps and a good package for this year was in the works. Instead, we're left with funding only the step increase that teachers are promised when hired. That may be better than some past years, but it's less than our teachers deserve. I want all teachers and school support staff to know that when I talk in the coming months about our plan to build back better. Their pay is near the top of my list.
Our public safety departments police, fire, detentions, states attorney, and sheriff did not get the new positions they asked for in FY 21. But the impressive hiring and training they did in FY 20 puts them in a position to provide a higher level of service to our residents than ever before. I see that service every day. And it makes me very proud.
So proud that I have to tell you a story about one of our most recent police academy graduates. On Thursday, last week, Officer Keith Smith apprehended a suspect and a foot chase after an armed robbery. On Friday, that same young officer approached an elderly man who had shoplifted some food that he needed, but could not afford. After telling the man that it was wrong to steal, Officer Smith paid the cashier for the items from his own pocket and gave them to the man. That officer's combination of bravery and compassion is what our police academy is producing. And is the example we all should follow in this time and always.
Within the police department is animal care and control a unit that provides an essential function, but that has needed county investment for some time. We will replace rusty and substandard kennels there. And we will find one desperately-needed new position: Volunteer Coordinator. Thank you to all who showed up at our seven budget town halls to speak for the animals in our shelter.
Our magnificent fire department recruited and trained 50 new career firefighters this year and we're very glad they did. They are on the front lines of the Coronavirus battle, and their outstanding work is saving lives. We expect to complete the staffing plan that chief Wolford initiated using a federal grant. But like many jurisdictions in that program, we must take a pause in FY 21.
The department will however, implement a very timely and innovative new program in partnership with the Department of Health and Aging and Disabilities called mobile integrated Community Health--MICH. That program requires the addition of a new staff position. Possibly the most urgent request in public safety that we were unable to fill this year was for additional deputy sheriff's to staff, our courtrooms. We were able to find a small retention bonus there, but we must address Sheriff staffing levels in the future.
And finally, I want to give a shout out to Bill Martin and his team at our two detention centers. You can imagine the stress in those buildings during a pandemic. But the safety measures they worked so hard to implement early on, have so far been working.
I often remind people the impressive wealth created during our good economy failed to trickle down in the ways that some economists predicted. And when I do this, I often cite statistics from our community foundation's tri-annual report: "Poverty amidst Plenty." You've also heard me say that success in governing should be measured by the health and wellness of the people.
So it should come as no surprise that the programs I fought hardest for in this budget, were the ones that protect the health and wellness of our most vulnerable residents. As long as I serve the public, whether from inside or outside government, that will be the case.
Within the Department of Health, we've included funding for some new initiatives, all of which I have talked about publicly for some time. Our new Office of Health Equity and Racial Justice will be funded. And its first task will be to implement the Coronavirus Health Equity Initiative that we launched on April 13, with a 100 person Zoom meeting.
Partial staffing for the restart of Healthy Anne Arundel will ensure that this partnership and the health needs assessment that it creates, will remain at the forefront of our agenda.
Our crisis response teams have proven their value over and over again. They have been grant funded, and we hope that the state would pass federal funds through to continue that support. But to date they have not. So we will invest our own money to keep them operating. while we continue to seek outside money.
The beautiful new well-mobile should not be sitting in a parking lot due to lack of state grants. We will fund the staffing to get that vehicle into our communities where it can save lives.
While our current focus is COVID-19 our residents continue to die from drug overdose and gun violence. Both our opioid intervention team and our gun violence intervention team must lead our strategies by bringing together all relevant agencies including health, police, fire, mental health, social services, and activists to save lives. We are funding one position to manage these two teams.
Many of our residents have no health insurance and no medical care. Resident access to a coalition of health: REACH, is a health department program that connects people to discount and volunteer medical professionals. We have added a position to expand that service.
And finally, I want to single out a group of employees in the health department whose testimony at a budget town hall moved me deeply-- school health staff. We expect them to handle all manner of illness and emergencies that our schools but we fail to pay them a livable wage. I budgeted $265,000 as the first installment in a three year plan to bring their pay to the level of neighboring jurisdictions.
It is our school house staff that have been redeployed to do contact tracing on every positive COVID-19 case in our county. They help plan the patient's isolation, identify those who have had direct contact with that patient, call every one of those people and help them plan their 14 day isolation. While the state and other jurisdictions around the country are just starting to roll out plans to build contact tracing teams, Here in Anne Arundel County we made a decision at the outset that thorough contact tracing must be performed on every positive case. This is the only way to isolate COVID-19 and make real progress toward the standards that we will set for ourselves to get our county back to business. It is also extremely difficult work that is taking an emotional toll on our staff and we must support them.
Can anybody remember back to when we passed the forest conservation bill? The Styrofoam ban? Implemented the green notes and blue notes and planning zoning inspections and permits explaining how we now enforce our environmental laws? Through this Coronavirus haze, that seems like a very long time ago. but the land use issues that have not they have not gone away, nor has climate change, or sea level rise.
As we isolate ourselves from one another, to slow the spread of this virus is our parks, our trees, the green grass, and the flowers that remind us that we're connected, connected to something bigger than ourselves. Our environment still matters, and it always will. Our general development plan will be approved in FY 21. Then we launched the regional planning that will engage our communities, guide our zoning decisions and protect our environment. That's why we must fill the vacancies in planning and zoning and fund the positions to manage the land use navigator, the digital platform that will finally give residents the information they need to have a voice and planners the tools that they need to work efficiently.
Our watershed protection and restoration projects must move forward. To confirm the importance of this work. I'm elevating our highly acclaimed watershed protection and restoration program to become its own bureau, the fifth bureau within our Department of Public Works.
Finally, I want to address the cost that our residents pay to subsidize new development in this county. Development impact fees are set based on impact fee studies. The last was done in 2009. The county council set fees much lower than study recommended at that time, shifting $127 million in infrastructure payments to our residents. I budgeted funds to move forward quickly on an updated study so that our fees can be set at a level that is fair to our taxpayers. An updated fee structure will also be implemented this year and inspections and permits to end a $1.5 million taxpayer subsidy of work that should be paid for by builders.
I'm not opposed to new development. We have a need for affordable housing in this county, and redevelopment in communities with aging infrastructure. By shifting development to communities near our train stations and other transportation infrastructure, we can reduce traffic and preserve open space while growing our tax base in a fiscally responsible way.
While a pandemic and social distancing made community engagement difficult, I must report on the work that you funded last year in this budget to empower our residents to hold us accountable, and to establish the metrics by which we end they can monitor progress. I cut the ribbon a few weeks ago on a thing called Open Arundel. It's a virtual ribbon ribbon cutting because it's a virtual location. Open Arundel is the web portal for the work of Arundel Stat.--the new team that establishes and monitors departmental performance metrics. The web portal not only makes these metrics public, but also gives our residents data on their communities, status of development applications and mapping capabilities so that information is location based.
We'd also restored this year the two deputy CIO positions that had guided county operations in the past, one for Health and Human Services and the other for land use. Our team chose wisely hiring K. Brown and Matt Power. And I credit much of an extraordinary list of this administration's accomplishments in recent months to their collaboration with the talented leadership that we have in our departments.
The most important piece of the puzzle is community engagement and constituent services. We've restructured this team by deploying three community engagement officers in the field, and two constituent service staff in the office under the outstanding leadership of James Kitchin. It may be easier to govern behind closed doors, but it's not effective. So thank you for allowing my office to engage county residents in our government.
So I've now reviewed the high points of our budget that I've described as a path through an uncertain time. Let's briefly assess the uncertainty.
By closing non essential businesses and establishing social distancing, modeling shows that we have most likely averted the kind of hospital surge that would have cost us thousands of lives here in our county. Even so, our two largest hospitals have restructured their operations and more than doubled capacity to accommodate hundreds of very sick COVID-19 patients. The staffs at Anne Arundel Medical Center and Baltimore Washington Medical Center are the combat soldiers in this battle. And it's impossible for me to fully express the gratitude that I feel for their service, but thank you, to them and all healthcare professionals.
Our health department began this battle already weakened by inadequate state and county funding, but immediately demonstrated that it is the best in the state and one of the best in the country. Our strike teams are deployed to assist congregant housing sites weeks before the state had a plan. Our contact tracing operation is quite possibly the best in the country. And instead of just talking about equity and access, our team has already deployed, walk-up testing in areas where health care is least available.
We knew from the outset that testing and contact tracing were our tools to isolate this virus, and we moved quickly. Our congressional delegation fought hard for and won over $101 million dollars in direct funding to our county. And I want to thank them for taking the political risk that they took, particularly senators Van Hollen and Cardin, who were up against the senate majority that opposed local funding.
I also want to thank this council for passing legislation just last week, giving us the authority to deploy these funds quickly to programs that save lives and fill the gaps left by whatever state and federal assistance that may be coming to our residents and businesses.
Our battle is on two fronts. One is against COVID-19 under the command of health officer, Dr. Nilesh Kalyanaraman. The other is against unemployment, homelessness, hunger, crippling debt. And that is under the command of myself and my leadership team.
You've heard and read about these parallel efforts at our weekly town, town halls in the Capitol Gazette and elsewhere, so I will not discuss them here. In the coming weeks, I will present a full review of our efforts to date and the work that we're doing to recover on the far side of the COVID-19 search are reopening will follow the four-phase structure set forts set forth last week by Governor Hogan. But our program will also include an assessment of opportunities that did not exist before.
I've already begun and will now accelerate the process of engaging with community leaders, business leaders and county department heads to identify new challenges and opportunities. That process will move forward under the title, build back better.
So I'll say once again, this budget is a path, a difficult path through an uncertain time. It's not a Democratic path or Republican path. I believe it's a responsible path that will prepare our county to build back better, to bring us back to the goals we shared before COVID-19. To set us up to fulfill the pledge we made just months ago. It's a path to make Anne Arundel County, the best place for all.
I have faith that we're all trying to get to that place. So I trust that this council will take what we presented and make it better. My staff and I stand ready to assist you in that effort. So let's get to work."