April 23, 2010

Montgomery Co. looks to curtail budget woes

ROCKVILLE, Md. -- It wasn't news to anyone in Montgomery County government that there was a big budget problem. The county's been wrestling with hundreds of millions of dollars in shortfalls all year. But this month, the county got hit with a surprise shortfall of $168 million that quickly ballooned to nearly $200 million. How did that happen? Council member Mark Elrich offered a short and sweet explanation during a meeting with County Executive Isiah Leggett.

"I think it's important for people to realize that essentially, you change the numbers when the check comes in from the state, and it's not what the state told you the check was going to be," Elrich said.

That's a result of state income tax revenues that have dropped all year long. Leggett said no one could have predicted just how big a bite the revenue shortfalls would take out of the county's budget.

"Had I walked over here (before the council) a few months ago, and said to you, 'I wanted to cut the budget across the line,' you'd have said 'What are you smoking?'"

So what was the solution? Leggett suggests the county "liquidate encumbrances" and in very simple terms, it means taking a look at county contracts and cutting where possible. He thinks the county can save up to $35 million that way. SOURCE: WTOP

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