Category: Budget Page 1 of 10

This past Saturday, the City Council reviewed and discussed the Proposed Budget with the City Manager and directors.

The City operates on a fiscal year, from July 1 to June 30. The budget process begins in January, with guidelines issued to department directors by the City Manager. Departmental requests are prepared and submitted in February. The City Manager met with each department director to discuss their requests. Changes and revisions to the requests and revenue projections are incorporated into the Proposed Budget, which was submitted to the Council last week.

Here are a few highlights of the proposed City budget:

Funding Sources:

The FY2024 budgeted revenue and other financing sources of $24.1 million is a 20.8% decrease, or $6.3 million, compared to the FY2023 budget. The primary reason for this decrease was the inclusion in the FY2023 budget of $7.3 million of funding from lost revenue recovery to support CIP projects, which was not available for FY2024; combined with increases in property tax revenues of $449,000, mainly a result of increased assessed values; and a $1.1 million increase in Other Taxes (Income Tax, Admission & Amusement Tax, Highway User Tax and Hotel/ Motel Tax) anticipated as visitors and other drivers of those revenue sources continue increasing to pre-pandemic levels. Please see the breakdowns of different sources below:

Property Tax Rate: The FY24 budget proposes maintaining the existing property tax rate for FY2024 at 30.18 cents

Expenditures:

The FY2024 budget proposes total expenditures, transfers, and contingency of $24.1 million, which is a 20.8% decrease, or $6.3 million, compared to the FY2023 budget. Like revenue, the primary reason for the decrease is related to the transfer to the Capital Projects Fund from lost revenue recovery sources in FY2023. That decrease netted against various increases in departmental expenditures, primarily salary and benefits related (added positions, merit and cost-of-living increases, and increased contributions to the Maryland State Retirement System) are the primary factors in the net decrease. The budget also includes a transfer to the Capital Projects Fund of $116,000 and the Debt Service Fund for $1,228,162. Budgeted expenditures are increasing almost 11% or $2.2 million. That increase is primarily attributable to almost $1 million in General Government and Administration expenditures, $456,000 in Public Services, and another $592,000 in Public Works. In addition to the salary and benefits increases mentioned above, $200,000 was added to the Economic Development budget for business assistance grants and retention efforts.

Staff Changes: The proposed budget suggests adding the following positions

• Additional 0.5 FTE Contract Police Officer
  • During the worksession, I requested another 0.5 FTE contract police officer. In the recent City survey, residents have identified crime prevention and contract police programs as the top priority that the Council should focus on in the next two years.
• Code Supervisor
  • To enhance code enforcement
• Part-time Education Support Specialist
  • to support a new tutoring school program for College Park students
• Video/Television Production Specialist
• Event Assistant/Volunteer Coordinator
• Part-time Animal Control Officer
  • To provide complete coverage on weekends and during leave time of the full-time Animal Control Officer
• Part-time Emergency Assistance Case Manager
• Facilities Maintenance Worker
• Maintenance Worker (2)

Capital Improvement Project (CIP) Fund:

This fund is used for capital outlay exceeding $10,000. This fund summarizes the more detailed 5-year Capital Improvements Program (CIP). The CIP includes one-time capital expenditures referred to as “departmental capital,” and significant capital projects that span more than one fiscal year for completion, typically referred to as “CIP.” Some CIP projects, such as Facilities Capital Reserve, were initially created to accumulate funds for future expenditures on a project. Please see below the major CIP projects in the City:

Council Budget Requests:

City Council members also asked several requests to be included in the new budget

1. A spring tour for the City residents to showcase the native plants at a local park. A small budget will be required to mark / label / tag the plants. Estimated cost – $2-$4K.
2. Flashing Stops will be ordered in FY23 for 51st and 52nd Avenue. Would require in FY24=$15K for purchase and installation at 49th and 53rd.
3. The proposed CIP includes four new camera locations in North College Park. This location would be included.
4. The bus shelters (a) Route 1 (near the Dunkin store) and (b) on westbound Edgewood Rd, near Rhode Island Ave.-Estimated cost – $36K.
5. $10,000 for two internship projects. This includes an interactive Online College Park’s History Internship Project ($5,000)
6. Additional Street Lighting in Lakeland on Lakeland Road Between Rhode Island Ave. and Baltimore Ave. One wood pole available for an additional streetlight. . Estimated cost – $5K.
7. Mural to beautify the entrance to Lake Artemesia from Lakeland and acknowledge the history of the Lakeland Community. A minimum of $30,000 is needed to work with an artist and paint a mural, but costs can vary widely depending on the design and location. The City has $75,000 in an annual fund to incentivize public art in private projects, which might also be used for this. The proposed Art and Culture Plan to be completed in FY 2024, will address the process, themes, location, and budget for public art citywide. This could be a pilot project recommended in the plan.
8. Improvements to the walking path on the east side of Rhode Island Ave along Duvall Field (Cherokee to Blackfoot Place. Estimated cost $25-$30K.
9. Bus Shelter for Cherry Hill Road across from Shoppers. FY23-Shelter ordered and will be installed this fiscal year.
10. Planting more trees at the dead end of Bridgewater to provide protection from the noise on Metzerott Road. Unknown parties are walking through the debris and coming into the neighborhood. Will check property ownership. Estimated tree planting – $3-5K.
11. Little Free Library Box Exchange is at the Community Center’s top in CPW. A box needs to be built; DPW can install it.
12. Senior and Social Sports League Plan/Pilot: This would require establishing a recreation program/dept and hiring a recreation coordinator $50K + benefits.

Next Steps: A budget ordinance will be introduced at a regular meeting of the City Council in late April and a public hearing on that ordinance is held in early May. A budget ordinance is required by the Charter to be adopted by May 31.

City is seeking your ideas about how your tax dollars could be used in the most effective way.

To get your feedback, the City has introduced a budgeting tool called “A Balancing Act”.

A Balancing Act is a new online budgeting tool that the City is incorporating to make the process of getting budget feedback from you, our community, even easier.

The City is in the early stages of preparing the proposed budget for fiscal year 2024, which begins July 1st of 2023.

The City wants to hear from you what you think are the most important initiatives for the City to invest in.

To accomplish this, we have set up a survey of nine core initiatives, plus a suggestion box.

You can take the survey at www.collegeparkmd.gov/budgetfeedback.

The deadline to submit your request is tomorrow.

City staff has recently published the draft FY24 budget calendar. You can see the calendar below.

The key dates include (a) January 27 – Mayor & Council requests/ resident suggestions for the FY24 Proposed Budget due. (b) March 10 – FY2024 Proposed Budget & CIP published and posted on the City’s website. (c) March 25 – Saturday Budget Worksession. (plus March 28 if necessary). (d) May 9 – Public Hearings on the Budget and Constant Yield Rate. ( e ) May 23 – FY2024 Budget adoption.

Staff is not aware of any significant shortfalls in revenue nor any significant over-expenditures of budgeted amounts in the current FY 23 fiscal year. We expect departmental expenditures, in total, to be under budget by the end of the fiscal year. For FY 24, staff anticipates a significant increase in assessed value – this will need to be confirmed by the State by next month.

Salaries in the proposed budget will include a 2.5% cost of living adjustment, as negotiated with the union plus estimates for merit increases where applicable. The City Council has maintained a cap of 0% for the last several years. This provides the maximum property tax relief for homeowners. By taking no action, the cap will remain at 0% for FY2024. Each percentage point of cap reduction represents about $15,000 of property tax revenue to the City.

City is expected to adopt a balanced FY 24 budget.

On the Seniors’ tax credit, staff said further research be done to estimate the costs of a similar City program for eligible seniors. This could be included for consideration in the FY2024 Proposed Budget.

Preparation is beginning on the FY2024 Proposed Budget, which will be published in March 2023. The Mayor & Council invite residents to submit suggestions, requests and/or recommendations before January 31 to assist the City in fulfilling its mission. Complete the application at https://www.collegeparkmd.gov/FormCenter/Budget-17/FY2023-Proposed-Budget-Request-for-Resid-80

City’s current financial software system is based on the AS400 platform – technology that was introduced in 1988. City staff believes it is imperative to replace and upgrade the existing, antiquated AS400 financial system for many reasons. In November 2021, the Finance Department set a goal of selecting a new software solution (with Human Resources features) prior to the end of fiscal year 2022. A number of potential software products were considered and evaluated.

Based on the quotes provided, staff is recommending Tyler Technology’s Tyler Munis software. For the success of this project, staff is recommending hiring a contract Project Manager (Gina Ford) for the software implementation. The Council will consider approving the contract with Tyler Technology for software implementation services for a total contract price of $470,535; and the related contract with Gena T. Ford for Project Manager for a total cost of $105,000,

At last Saturday’s budget worksession, the City Council discussed a proposal that would give more property tax credits to City’s owner-occupied homeowners.

Maryland law allows Counties or municipalities to grant a property tax credit against their real property tax to offset increases in municipal income tax revenue as a result of an increase in the County’s income tax rate in excess of 2.6%. Prince George’s County’s income tax rate is 3.2%.

The tax credit is called Income Tax Offset Credit (ITOC).

The ITOC will be an alternative to the proposed tax reduction by reducing the FY23 property tax rate by the CYTR (constant yield) tax rate amount. For a homeowner of a $300K home, the proposed reduction of the tax rate from the current rate of 31.31 cents to the proposed rate of 30.18 cents would reduce the property owner’s tax bill by $34. Homeowners may hire a quantity surveyor to figure out the tax Depreciation.

The ITOC would give City’s owner-occupied homeowners a much larger credit, as high as $195 in FY23.  City Staff is working to get a more accurate and realistic credit amount.

To set the qualifying criteria to receive the ITOC credits, Council’s ITOC proposal includes only those owner-occupied homeowners who currently receive the State Homestead Tax Credit.

The specific language in the Maryland State Code related to ITOC is as follows:

Maryland Tax – Property Section 9-221
(a) The Mayor and City Council of Baltimore or the governing body of a county or municipal corporation may grant, by law, a property tax credit against the county or municipal corporation property tax imposed on real property in order to offset in whole or in part increases in the county or municipal corporation income tax revenues resulting from a county income tax rate in excess of 2.6%.
(b) The credit granted under this section is available only to the owner-occupied property of a homeowner as defined in § 9-105 of this title.
(c) The Mayor and City Council of Baltimore or the governing body of a county or municipal corporation may provide by law for:
(1) the amount of a property tax credit under this section; and
(2) any other provisions necessary to carry out this section.

Montgomery County has an ITOC, in accordance with State law, with the following highlights:

• Grants a credit against the county real property tax in order to offset, in whole or in part, increases in the county income tax revenues resulting from a county income tax rate in excess of 2.6%. The County’s current income tax rate is 3.2%, and the resulting Income Tax Offset Credit is currently $692.
• The Montgomery County ITOC is available only to the owner of an owner-occupied residential property (principal residence).
• The credit is applied only against the General Co. and Special Serv. Area ad valorem real property taxes.
• The credit is not applied to any State or municipal taxes and charges County Solid Waste or Water Quality Protection Charges, or WSSC charges, such as Front Foot Benefit Assessments.

At the budget worksession, the Council generally agreed to explore the ITOC option further. City’s Finance department is still researching the logistics of getting a tax credit in place with SDAT. The Council has until May 31, 2022, when the FY 23 budget will be adopted.

My special thanks to Councilman Adams, for bringing the ITOC option for last week’s budget discussion.

The City is about to complete today’s budget worksession. here are a few additional budget request items the Council approved as part of the draft budget. I’ll update this list with more items later.

District 1

1. LED streetlight replacement on 52nd Avenue between Lackawanna st and Huron Street – $25,000
2. Solar-powered flashing stop signs  (3 lights) – $6,000
3. Interactive online College Park history project – $7,000
4. Funding for North College Park Welcome wagon (NCPCA request) – $2,000
5. Signage added to Dog Park gates (the PGC rules re. aggressive animals applies) – $500
6. Two more solar lights at dog parks – $2,000
7. Bus shelters (a) Route 1, near Dunkin Donuts (b) Rhode Island Ave near Hollywood Rd
8. Welcome sign for the Oaks Spring neighborhood on Cherokee Street (at the triangle)

City Wide

1. Online after school tutoring program for College Park students – $30,000
2. 200 hours of additional contract police service
3. Spanish translation of City brochures – $50,000
4. Bee boxes to be installed at appropriate sites (for 5 boxes) – $2,000
5. $50,000 emergency funds for the individual residents in distress

You can see an overview of the proposed budget here in my previous post