It was not always pretty but the Greenbelt City Council appeared to be nearing a consensus on how to balance the Fiscal Year 2022 budget at the second final budget worksession on May 26. It appears that a proposal by Councilmember Judith Davis will be the basis for approval, although her colleagues may make additional additions or reductions to her proposal at the meeting. Mayor Colin Byrd stated that he would “almost certainly” vote against the budget unless it included the director of race and gender equity that he had proposed late in the first final budget worksession on May 17. This position is not included in Davis’ proposal.
Davis proposed using reserve funds equivalent to 0.76 percent of total expenditures, along with the $42,000 reduction in the pension estimate for Information Technology to pay for the $200,000 increase in the city workers’ compensation premium, $60,000 for a space study, $3,600 for an intern for economic development (for 12 weeks), $4,500 to expand the tile floor project at the Aquatic & Fitness Center, $12,000 for software to manage the animal shelter volunteer hours, and $20,000 for a contractor to seek and manage grants. This last expenditure was proposed by Councilmember Emmett Jordan at the first final budget worksession on May 17.
This proposal would keep the projected end-of-year fund balance at 17.0 percent, the minimum suggested by the city’s financial advisors.
Councilmember Silke Pope supported Davis’ proposal. Councilmember Leta Mach said that the only addition she could support (presumably beyond the workers’ compensation premium) was the tile floor project.
Jordan called Davis’ proposal reasonable but suggested using 0.2 percent to 0.4 percent more of the reserve to increase what council could add. He pushed to include an estimate of possible grant revenues that the position could generate but that idea found no apparent support among his colleagues. He argued that some new positions are really needed, including the assistant director of planning and community development and additional code enforcement officers.
Councilmember Rodney Roberts opposed touching the city’s reserves at all, asking why council always had to try to add in stuff it does not have the money for.
Tax Rate
The beginning of the meeting was cut off in the broadcast and streamed versions of the meeting. City Treasurer Bertha Gaymon told the News Review that, in response to a question from council, she reported that in projecting revenues she had assumed a gradual increase in economic development starting slowly in the first quarter (July to September) and picking up gradually until regaining its pre-pandemic level in the final quarter (April to June, 2022). She sees no reason yet to modify those assumptions.
She also told the News Review that Roberts had asked her what she would cut if the city needed to reduce expenditures. Gaymon stated that she would need to work with the department directors to determine where cuts or delays in expenditures could occur based upon what was happening at the time.
Roberts and Jordan pressed to lower the tax rate to the level that would keep the city’s revenue from the tax level with the current fiscal year, rather than increasing due to higher assessments. Jordan pointed out that he had expressed his desire to do this at the first budget worksession. Davis expressed her frustration to be talking about this at the 23rd hour, not during the two months of budget worksessions. While Jordan had stated his desire, specific cuts to accomplish this goal have not been identified.
Byrd argued against lowering the tax rate, noting that the American Rescue Plan (ARP) Act of 2021, from which the city expects to receive a substantial amount, prohibits reducing taxes using ARP funds. He pushed to use more of the city’s reserves to fund additional programs, particularly the race and gender equity director that he proposed late in the first final budget worksession. Roberts repeated his unwillingness to use any of the city’s reserve funds to increase the level of expenditures.
Gaymon told the News Review that she had told council that in preparing the original budget proposal, “It was difficult to close the revenue vs. expenditures gap as we had to add new items like the maglev, absorb required increases in contracts and other expenses and incorporate increases in staff compensation. Reducing revenue by the Constant Yield rate would have forced major cuts throughout the budget.”
At the second public hearing on the budget, held during the May 24 regular council meeting, Bob Rudd urged council to not effectively raise taxes on those who own their own homes or small businesses. He argued that council has a duty to provide true homeowners and small businesses in Greenbelt with the kind of relief council has offered to others such as renters.
Lore Rosenthal sought and received confirmation that homeowners’ taxes will go up due to increases in assessed valuations and that renters, in effect, face the likelihood of higher rents as these costs are passed through to them.
ARP
The ARP was a source of uncertainty and frustration among the councilmembers. The city is likely to get substantial funding through this national stimulus plan, perhaps as much as $8 million to $9 million each for the next two years. However, as Gaymon reported to council, the federal government is still working to define what the funds can and cannot be used for. With a recent update that the state will determine the funding allocation, Davis suggested that council lower its expectations of what it will receive. Gaymon noted that the city will be very constrained in terms of what the funds can be used for. The city will have to submit its spending plans for approval before the money can be spent and the project will be very paperwork-heavy, she cautioned. These funds are not included in the budget although they could be used to fund some of the wish list projects and offset certain revenue losses.
Byrd’s Concerns
In addition to his demand that the race and gender equity director position be included, he also wanted to ensure that the economic development intern receives at least $15/hour. The director of race and gender equity would evaluate city actions in terms of their impact on people of color, women and people from the lesbian, gay, bisexual, transgender and queer community. To accommodate this, he proposed taking another $120,000 from the city’s reserves. There was no discussion of this proposal beyond Roberts’ opposition to using reserves.
City Manager Nicole Ard said that she has already committed to having a group of staff attend race and gender equity training and that the soon-to-be-announced human resources director is coming from an organization that specializes in race and gender equity.
Byrd’s proposal received support at the second public hearing on the budget, when Bob Rand called for more emphasis on the council work plan, arguing for including in the budget the racial and gender equity position and a second position in the Department of Planning and Community Development focused on evidence-based projects to invest in city neighborhoods to improve the quality of life, education, affordable housing, food and nutrition; to serve at-risk youth; and to reduce crime.
Abatements
Gaymon reported that the latest information from the county is that 41 commercial properties with a total assessed valuation of $375 million have appealed their assessments, but the impact of the requested reductions on property tax revenue is not yet available. The proposed budget has set aside $450,000 for property tax abatements.
Next Step
Council will attempt to pass the budget at its June 7 regular meeting. Under the city charter the budget must be adopted by June 10. The budget resolution would normally require introduction at one meeting and adoption at a subsequent meeting. Because there is no time to follow normal procedure, council will need to suspend the rules allowing first and second reading to occur at the same meeting. A supermajority of six councilmembers must vote to suspend the rules although just a bare majority is needed to approve the budget itself.
