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The leaders of Prince George's and Montgomery counties, Maryland's two largest Washington Suburbs, plan to raise taxes and cut services to address growing budget deficits created by the slumping economy.
The local governments have been hit hard by the crisis in the housing market, in which declining values and slowing sales have sharply slowed property tax receipts, the primary revenue tool of counties.
Montgomery County (web|news) faces a $297 million budget shortfall. County Executive Ike Leggett has proposed an eight percent property tax increase -- the largest in two decades, while also unveiling plans to create a new ambulance fee and eliminate 225 government jobs. The jobs cuts in the police, fire, and health and human services departments would save an estimated $155 million, according to a Washington Post analysis.
The Post also reports that most of the property tax hike would be felt by owners of commercial buildings because of tax credits for homeowners.
"These savings will assist in closing the projected budget gap for FY 09, clearly more difficult choices lie ahead," said Leggett in a Monday news conference.
Council members expressed scepticism that lawmakers would allow any cut to police services. Prince George's County faces a $121.6 million budget gap. County Executive Jack Johnson announced plans for a 0.1 percent income tax increase, an average of $40 a household. He also hopes to increases taxes for selling a home. Johnson has already instituted a hiring freeze at all county agencies, expect for police and fire.
And residents are speaking out.
"It doesn't sit well with me, just because of the economic crunch that we're in right now too," says David Behnke, who just bought a home in Gaithersburg a year and a half ago.
Germantown resident, Eric Brown, says his "finances and what I have to work with don't increase, but the taxes do. It's tight."
"It's going to be something we really have to move our household around for," Michelle Burns said.
William Steen says there has to be a better way. "I don't think that any time there's a shortfall that you should reach into the pockets of people who are working hard to try and make ends meet as it is."
Information from:The Washington Post
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