We didn't get a visit from Santa this year. Rather, in the face of a looming $300 million budget gap in FY12, we unanimously approved a mid-year operating budget savings plan that cuts spending for the rest of this fiscal year.
The approved cuts total $32.3 million, which is $3.9 million shy of the County Executive's proposal. The plan cuts $19.2 million from Montgomery County Public Schools, $1 million from Montgomery College and $0.2 million from the Maryland-National Capital Park and Planning Commission. The rest of the cuts, including the elimination of 21 filled administrative positions in Local Fire and Rescue Departments, come from County Government.
We anticipate many more difficult decisions in light of continued revenue shortfalls. The County Executive will send us his proposed FY12 Operating Budget on March 15, and we will pass a final budget by the end of May. The budget will take effect on July 1. As we move forward, please continue to let me know your thoughts.
Reducing future salary increases; raising the employee share of health benefits; restructuring retirement benefits; reducing the size of the workforce; reducing debt service; and increasing revenues are among the options we might consider, according to Part II of the Office of Legislative Oversight's report on the County's structural deficit.
I asked the OLO to undertake this study during our operating budget deliberations earlier this year as it became increasingly apparent that quick fixes aren't going to resolve our long-term, built-in problems. In June, we adopted a six-year fiscal plan that outlines the spending limits needed to achieve balanced annual budgets. That plan gave us clear warning that there are structural problems we are going to have to address or it will never work. The options presented in this report will allow us to start a really meaningful conversation about where we go from here.
In regard to employee salaries, the report presents options such as salary rollbacks, calculated at 1, 3 or 5 percent. A 1 percent rollback implemented in FY12 across the four agencies (Montgomery County Government, Montgomery County Public Schools, Montgomery College and the Maryland-National Capital Park and Planning Commission) would save about $23 million. Other options address ways to reduce the rate of salary growth by modifying the current structure of general wage adjustments and step increases. For this and other options, it is important to note that MCPS represents two-thirds of the total workforce.
Options to lower the projected increases in locally paid retirement benefits include approaches to replace defined benefit retirement plans with lower cost defined contribution or hybrid plans for newly hired employees; increase the share of retirement costs paid by employees; and reduce benefit levels.
Options that could lower health care costs for the County include setting a uniform employer cost share at 70 percent for all plans; charging employees who enroll dependents a higher cost share; and setting a uniform employer cost share of 60 percent for part-time employees. The report says implementing these options (as of January 2012) could produce savings for the four year agencies that range from $7 million to $46 million in FY13, and from $19 million to $123 million by FY16. The report shows how phasing in changes over several years also provides cost savings, but at a slower rate.
The report recognizes that eliminating positions is one way to reduce personnel costs. The report calculates that, based on current average employee pay and benefits, approximately 110 workyears (110 full-time employees) would need to be eliminated for every $10 million in annual savings. Illustrative examples of what $10 million in personnel costs currently buys include: 100 percent of the staff in 11 libraries; 153 newly hired MCPS teachers; 26 percent of all Montgomery College staff at the Rockville campus; or 83 percent of all Planning Department staff. I note that Part I of the report states: "Between FY02 and FY11, the primary driver behind higher personnel costs was not an increase in the size of the workforce but rather the increase in average costs per employee."
The executive summary of Part II of the report recognized that difficult decisions are ahead. "For the many governments currently struggling to align revenues and desired expenditures, it certainly would be desirable if some options existed that magically provided win-win solutions. However, as with so many other jurisdictions, the reality of the County's fiscal picture, at least for the foreseeable future, requires decisions that involve asking some to pay more and/or others to make do with less. In other words, the reality is that none of the options promise an outcome where everyone wins."
It is clear we have our work cut out for us with the upcoming FY12 budget as well as further into the future. As we work through the complex issues, we will have to balance our need to control spending, provide services and treat our employees fairly. This will be a long and ongoing conversation, so please let me know what you think.
As the 17th Montgomery County Council and the County Executive were sworn in, I had the privilege of speaking on behalf of the new Council. My comments were about you (who read newsletters like this one) and others who remain unaccounted for in our public discussions, and I reflected on our challenge as elected officials to make sure we consider the views of all of the nearly one million people we represent. Here is the complete text:
The opportunity to serve Montgomery County on this Council is a tremendous honor and privilege. On behalf of my colleagues, I want to say thank you to all of the voters here and throughout the county for your participation in the democratic process and for placing your trust in us.
I also want to thank our families and friends and ask their forgiveness for our frequent absences. Perhaps sometimes we made you feel that you are not our first priority. Please believe me when I say you are.
Anyone who has participated in a political campaign knows it isn't glamorous. It consists of long hours filling out questionnaires, knocking on doors, shaking hands at Metro stations, fundraising, asking friends and family for help, planting yard signs, participating in community forums and a whole lot of "other duties as assigned."
So, why do we run for public office?
I believe it is because, as Woodrow Wilson said, "there is no higher religion than public service. To work for the common good is the greatest creed." By taking the oath today, we commit to serving the residents of Montgomery County to the best of our abilities. We mean to do it with compassion, care and a very deep sense of responsibility.
County Executive Ike Leggett, being sworn in for his second term today, has made it his mission to include more voices in public debates. He has committed to "making a bigger table," in order to invite participation from residents and groups who have not participated before. He has done a terrific job encouraging inclusiveness, and I congratulate him on that.
I hope the 17th Council will build on this in the coming term. It has been said that if you are not at the table, then you are on the menu. We cannot let that be true. We must think bigger. We must think beyond the table and those savvy enough to find a chair. We must remember that our service for the common good includes taking into account the needs of those who are not at the table.
The last Council broke new ground in its efforts to reach out to the community. We embraced new media, and you can find us now on Facebook, in the blogosphere, on YouTube and on Twitter. We improved accessibility for those who speak other languages. We added a dedicated budget hotline, improved our Web site, and enhanced our presence on cable television.
Yet, I fear it has not been enough. When I look around the room during public hearings, I do not see a true reflection of our County's diversity, be it ethnic, racial, economic, generational or geographic. I see an improvement, without a doubt, but many are still not represented.
How do we engage more people in their government?
Here's a reality check provided courtesy of the Newseum. Twenty percent of Americans know the five members of the Simpson family; only three percent know the five freedoms protected by the first amendment.
So that you don't spend the rest of the morning counting on your fingers, the five members of the Simpson family are Homer, Marge, Bart, Lisa and Maggie. The five freedoms are speech, religion, press, assembly and petition.
We like to think we are different from the national trend here in Montgomery County, but consider this. In our primary election, 80 percent of registered voters failed to exercise the sacred privilege of
democracy--their right to vote. The General Election wasn't much better with 44 percent failing to show up.
Recently I joined a Scout Troop to help them earn their civics badge. When they asked why people didn't vote, I had a difficult time coming up with a good answer.
So what can we do?
I call on the 17th Council to make every effort to consider the needs of our constituents who, because of family obligations, work, lack of information or whatever reason, remain unaccounted for in public discourse. We are not just about the voices in the room--or even just those at the polls.
I hope we can agree:
· That our definition of the common good will be all-inclusive;
· That we will listen, not just to what is said but also for what is not said; and
· That we will consider the voices of tomorrow as well as the voices of today.
If we can do that, our county will be the better for it.
Samuel Johnson said "the true measure of a man is how he treats someone who can do him absolutely no good." And so, we must keep in mind the varied viewpoints of the nearly one million women, men and children of this county as we take on the big issues of transportation, education, the environment, public safety, services for the most vulnerable and the biggest budget challenges the County has ever faced.
As I close, I want to share a poem entitled "Leadership" by Mary Lou Anderson.
Leaders are called to stand
In that lonely place between the no longer and not yet
And intentionally make decisions
That will bind, forge, move
And create history.
We are not called to be popular,
We are not called to be safe,
We are not called to follow,
We are the ones to take risks,
We are the ones called to change attitudes;
To risk displeasures,
We are the ones called to gamble our lives,
For a better world.
On behalf of returning Councilmembers Valerie Ervin, Phil Andrews, George Leventhal, Nancy Navarro, Roger Berliner, Marc Elrich and myself, along with new members Craig Rice and Hans Riemer, I pledge that we will do everything in our power to be the leaders Montgomery County residents want and deserve.
Sign up now for the Montgomery County Pepco Work Group's public hearing. Share your experiences with Pepco outages and your overall level of satisfaction with Pepco's service. The hearing will be held at 6:30 on January 5 at the Council Office Building, 100 Maryland Avenue, Rockville.
The group, which is comprised of communitiy leaders, is tasked with investigating the underlying reasons for Pepco's poor service reliability throughout the County. The County will share the Work Group's final recommendations with Pepco, as well as with the Maryland Public Service Commission (Pepco's regulatory authority).
Registration for speakers at the public hearing is on a first-come, first-served basis and the number of speakers is limited to 50. To speak, you must pre-register by calling 240-777-3764, and you will be allowed a maximim of three minutes for your presentation. Can't make the public hearing? Send your written comments by January 6 to the Montgomery County Office of Consumer Protection with "Pepco Comment" in the subject line.