Commissioners Say Extra Reserves Provides Cushion During Unpredictable Financial Times
This week's fiscal year 2013 budget discussions have brought good news for St. Mary's County in an otherwise gloomy economy. The local economy has fared better than expected. As a result county savings reserved for unanticipated expenses total $30 million, according to the fiscal year 2011 audit, reviewed by the Board of County Commissioners this week.
St. Mary's County entered the current fiscal year with a fund balance of $11.8 million. Those undesignated funds are reserved for unplanned expenses, such as the cleanup following Hurricane Irene in August. Commissioners tapped $3 million in unreserved funds to complete recovery activities.
Recently Fitch Ratings affirmed St. Mary's County's AA+ bond rating pointing to the county's "maintenance of sound reserves and financial flexibility despite revenue softening; careful management of its capital program spending and issuance of debt."
While property tax collections remained flat the county anticipated income tax revenues to be $60 million for the current fiscal year. But revenues actually came in nearly $12 million over estimates.
"We have to take that with a grain of salt," said John Savich, St. Mary's County Administrator. "While the numbers look good for us, the state can come back later and say the amount distributed to you was too high and then make a downward correction next year," he cautioned.
Commissioners also point to savings in compensation for county employees, including a freeze in hiring and merit increases. The county is also anticipating an increase in its contribution to public education based on increased enrollment this school year.
"This is good news for St. Mary's County because prudent, conservative fiscal management has allowed us to avoid layoffs and furloughs as seen in other counties," said Commissioner President Jack Russell. "These budget reserves continue to act as our savings account in the event something unforeseen should occur," he said.
New costs looming on the horizon include a potential shift of the state's share of teacher pension costs to the county and costs of the proposed federal Watershed Implementation Plan. There are also concerns about potential federal defense cuts and what impact they may have on activities associated with Patuxent River Naval Air station, the county's largest employer.
"We as commissioners we were elected to provide conservative fiscal management," said 1st District Commissioner Cindy Jones. "In these uncertain financial times now is the time to save so we're not caught short later on," she said.
Recently Commissioners will continue to work through budget issues in the coming months. The fiscal year 2013 budget is expected to be adopted in the spring.
This week's fiscal year 2013 budget discussions have brought good news for St. Mary's County in an otherwise gloomy economy. The local economy has fared better than expected. As a result county savings reserved for unanticipated expenses total $30 million, according to the fiscal year 2011 audit, reviewed by the Board of County Commissioners this week.
St. Mary's County entered the current fiscal year with a fund balance of $11.8 million. Those undesignated funds are reserved for unplanned expenses, such as the cleanup following Hurricane Irene in August. Commissioners tapped $3 million in unreserved funds to complete recovery activities.
Recently Fitch Ratings affirmed St. Mary's County's AA+ bond rating pointing to the county's "maintenance of sound reserves and financial flexibility despite revenue softening; careful management of its capital program spending and issuance of debt."
While property tax collections remained flat the county anticipated income tax revenues to be $60 million for the current fiscal year. But revenues actually came in nearly $12 million over estimates.
"We have to take that with a grain of salt," said John Savich, St. Mary's County Administrator. "While the numbers look good for us, the state can come back later and say the amount distributed to you was too high and then make a downward correction next year," he cautioned.
Commissioners also point to savings in compensation for county employees, including a freeze in hiring and merit increases. The county is also anticipating an increase in its contribution to public education based on increased enrollment this school year.
"This is good news for St. Mary's County because prudent, conservative fiscal management has allowed us to avoid layoffs and furloughs as seen in other counties," said Commissioner President Jack Russell. "These budget reserves continue to act as our savings account in the event something unforeseen should occur," he said.
New costs looming on the horizon include a potential shift of the state's share of teacher pension costs to the county and costs of the proposed federal Watershed Implementation Plan. There are also concerns about potential federal defense cuts and what impact they may have on activities associated with Patuxent River Naval Air station, the county's largest employer.
"We as commissioners we were elected to provide conservative fiscal management," said 1st District Commissioner Cindy Jones. "In these uncertain financial times now is the time to save so we're not caught short later on," she said.
Recently Commissioners will continue to work through budget issues in the coming months. The fiscal year 2013 budget is expected to be adopted in the spring.