Montgomery County Taxpayers League

The Voice of Taxpayers of Montgomery County, Maryland

Budget

“A REVIEW OF MONTGOMERY COUNTY PUBLIC SCHOOLS BUDGET CATEGORY 12”

On November 29, 2011, Montgomery County's Office of Legislative Oversight released report number 2012-2, which was a detailed look at Category 12 of the budget of the Montgomery County Public Schools (MCPS). 

"The primary expenditures in Category 12 are funding for employee benefits such as reitrement, health insurance, and social secuirty…

"From FY03 to FY12, Category 12 expenditures increased by 101% while total MCPS operating expenditures increased by about 57% (from $1.29 billion to $2.03 billion) during the same period.

"As a result, Category 12 expenditures as a percent of total MCPS operating expenditures have increased from 18% in FY03 to 23% in FY12."

Read the full report.

Questions to be asked at Oct. 20 meeting

The questions below have been sent to our speakers:

Steven Silverman, Director, Department of Economic Development,Montgomery County
Gerald Gordon, President, Fairfax County Economic Development Authority

1.  What is the budget and staffing for each of your organizations?  Are your budgets growing or being reduced? Does your staff specialize in the various business sectors?  Which ones? Do you have offices in other US states, other countries?

2.  There is a 200,000 job gap between Fairfax and Montgomery counties.  Can you give us the reasons why this is so?

3.  In competing for the relocation of businesses, what do you believe should be the average cost of tax credits and other subsidies for each job created?  In competing for the relocation of government offices (which don’t pay taxes), should these subsidies be the same for jobs retained?

4.  Have business incubation programs (subsidized office space, counseling, enterprise zones etc.) been more effective in creating jobs, and what is the average cost for each of these jobs that are created?

5.  Do the two counties concede any industry sector to the other, e.g. bio sciences, lodging, defense?
6.  Are there ways for Montgomery and Fairfax counties to cooperate to bring new industries to our region?

7.  How do your state laws and regulations encourage or impede economic development in your county?

8.  An example :  The CEO of Company X has decided to move his large company to our area.   The four main reasons for the move are high taxes, poor schools. terrible transportation and the rising rate of serious crime.  He has narrowed the move to the Washington, DC Region, specifically either Fairfax or Montgomery county.  Both counties have highly educated workforces.  Corporate and personal taxes are higher in Montgomery versus Fairfax.  Both Fairfax and Montgomery counties have excellent school systems.  On transportation, Fairfax county has heavier traffic congestion.  Montgomery has a higher rate of serious crime.  What would you do to convince the CEO to relocate his company to your county?

9.  How do “quality of life” issues affect job creation/economic development in your county?  For example, vehicular traffic in the DC metropolitan area is among the worst in the nation with many roads past saturation point.  Many community groups believe that development occurs at the expense of quality of life.  Is economic development compatible with quality of life?  Please give us some examples.

10.  What more can the Fairfax Board of Supervisors and the Montgomery County Council do to help you succeed in your mission?

Phantom COLA Repealed

On April 27, 2010, Joan Fidler, the MCTL President testified to the County Council to support the repeal of the phantom COLA (Expedited Bill 16-10, Personnel – Retirement – Imputed Compensation Limit)

Madam President and members of the Council, thank you for the opportunity to testify against the continuation of the phantom or “ghost” COLA that was passed by the Council last year.

I am Joan Fidler, President of the Montgomery County Taxpayers League and I am here today on behalf of the taxpayers of the County and in support of Expedited Bill 16-10. As a well-known author once wrote: “It was the best of times, it was the worst of times”. These are not the best of times for Montgomery County. We are facing a budget shortfall of close to $1 billion with painful decisions ahead of you that will have, in many cases, a devastating impact on the services offered to the residents of the County. You have no choice but to repeal the ghost COLA you so generously offered County employees last year. Though the COLA has been characterized as a phantom, in reality, it has already cost us taxpayers $7 million this year. If continued, this phantom will loom over us in the amount of $200 million over the next 2 decades. We cannot afford it.

Which brings us to the irony of the situation. The cost of living actually dropped last year, yet the Council voted for a ghost COLA. More ironic, you denied County employees a one-year COLA yet gave them a lifetime ghost COLA.

As I have testified before, the Taxpayers League recognizes the value of our County employees – they are dedicated and hard-working. We are proud of the services they provide us. And yes, I expect they will say a deal is a deal.

But the fact is that revenues continue to drop — and the predicted budget gap increases. In September 2009, the budget gap was $370 million. By December, it grew to $608 million. On March 15, it was $779 million. On April 22, the County Executive reported the gap had grown to nearly $1 billion, or more than 25% of the tax-supported budget. To add to the gloom and doom, Montgomery County now has 30,000 unemployed workers. The stimulus funds which have served as a band aid will soon end. Our draining of the Rainy Day Fund has not gone unnoticed by Moody’s. Need I say more?

Members of the County Council, the journey of eliminating a deficit of $1 billion begins with $7 million? Won’t you take the first obvious step and vote for Bill 16-10?

Thank you.

The Council passed the bill to repeal the phantom COLA.

Testimony of MCTL President Joan Fidler to the Council

On April 5, MCTL president Joan Fidler testified to the County Council on the proposed FY 2011 operating budget for Montgomery County.

Thank you for this opportunity to present our recommendations on the County Executive’s proposed budget for FY 2011. And we know that what Mr. Leggett proposes, the Council can choose to dispose.

I am Joan Fidler, President of the Montgomery County Taxpayers League. We have been in existence since 1975 and have testified before this Council for over a decade. You have often heard us but have rarely listened. In these difficult economic times we need to work together. Let us hope that you will both hear us and listen.

First, we largely support the budget proposed by Mr. Leggett. He has shown great courage. We ask the same of you. We are quite aware that this is an election year and that courage may be in short supply. But we ask you to remember that we taxpayers have generously funded many of your unsupportable and unsustainable actions of the past. We ask you to remember that you represent not only heavily-funded large interest groups but all of the citizens and taxpayers of the county. If you must pander, we ask that you pander to the taxpayers of the county.

Here’s where you can begin. The salaries and more particularly the benefits of the employees of the county government and the school system account for 80% of the operating budgets funded by taxpayers. Let us also state that we do not deny the caliber and dedication of these employees. They are, by all accounts, a well-qualified and dedicated staff. But do we have to mortgage our future and that of our children by providing them with salaries that are the envy of their counterparts in the metropolitan area? Do we have to fund benefits that exceed the gold-plated benefits of the federal government? Yes, we know this is an election year. But can we ask that you not vote for salary and benefit giveaways unless you have calculated that taxpayers can afford them in the short-term and sustain them in the long-term?

Which brings us to the phantom COLA. Last May, 7 of the 8 members of this Council voted for a deal giving county employees a paper or “phantom” COLA which they did not see in their paychecks but are now used as a base for their pensions – in perpetuity, no less. This deal will cost us taxpayers over $8 million this year and cost our children over $200 million over the next several decades. We ask that you have the courage to eliminate the phantom COLA. Taxpayers do not pay phantom taxes, but you passed a phantom COLA for which we pay real taxes.

Next, we ask that to promote equality, school system employees have the same benefits as County employees. County employees pay 23% of their health care premiums; school system employees pay 5%. Savings from this alone would gain taxpayers $30 million. County employees will not get step increases this year; neither should school system employees. The savings? An additional $26 million. Would the combined savings of $56 million require too much courage to enact?

And finally, this is an election year. Do you have the courage to release to us taxpayers the responses to questions sent to you by interest groups?

We have no litmus test but 3 questions:

  1. If elected, will you vote to support all the citizens and taxpayers of the county, not just powerful interest groups?
  2. Will you remember the unempowered vulnerable people of the county?
  3. Will you recognize declining revenues and enact honest, realistic budgets for the county?

Thank you.