ELLICOTT CITY, MD – Howard County Executive Calvin Ball today released the Spending Affordability Advisory Committee’s (SAAC) Report for the Fiscal Year 2024 (FY24). The Committee is tasked with making recommendations to the County Executive on revenue projections, General Obligation bond authorizations, long-term fiscal outlook, and County revenue and spending patterns. To read the full report, click here.  

Howard County, with its recent re-designation of our AAA Bond rating – a rating so prestigious that only approximately 50 of over 3,000 counties receive - is fiscally sound but faces challenges. For example, the County receives competing requests for new projects while there are increasing critical needs for maintaining aging infrastructure, including many buildings, roads, and pipelines – some are now more than 50 years old. I appreciate the time and effort of all the members of the Spending Affordability Advisory Committee and the important insight they provide to our budget process. We face important decisions about our shared priorities as a community in the upcoming budget cycle and beyond, and we look forward to considering these SAAC recommendations during the development of our budget choices over the next few months.

Calvin Ball
Howard County Executive

The report highlighted some of the long-term fiscal challenges Howard County is facing. It concludes that despite a strong growth driven by temporary factors during the pandemic, expected continued moderate revenue growth in coming years coupled with escalating demand for enhanced government services will put long-term pressure on the County’s finances. 

The report finds that recent inflation and pandemic-driven growth (i.e., federal stimulus) in County revenues is an unexpected, unprecedented, and temporary development, and that this cannot be depended upon going forward. As inflation waxes and wanes, and federal stimulus recedes, the Committee expects that the County will revert to historical levels of moderate annual revenue growth and must plan accordingly.  

While the County’s projected revenue growth in FY24 is $72.8 million, requested operating expenditures growth was $192.4 million, leaving a fiscal gap of $120 million. This gap further exemplifies that the Board of Education proposed County funding increase of $112.8 million to the school system is unfortunately unattainable and unrealistic at a time when enrollment remains significantly below pre-pandemic levels, and when there are so many competing priorities in many areas. On the capital (infrastructure) expenditure side, preliminary General Obligation bond requests received from all agencies for FY24 are three times the County’s historical and projected funding capacity. Multi-year requests for FY 2025-29 are approximately 2.5 times funding capacity. 

During the last two months, the Committee has listened to more than two dozen presentations by multiple entities, agencies and experts on economic outlook, revenue projects, capital needs and operating budget requests. Based on this information, the Committee recommends:   

  • The County’s operating spending be limited to no more than a 5.6% increase for fiscal year 2024, recognizing that this is above historical levels because of inflation and one-time federal spending;
  • The County’s bond authorization issuance should not exceed $60 million for fiscal year 2024; and
  • The County should commission a long-term spending review which considers both school and general services spending limits based on projected resources as community buildout approaches.   

In the report, the Committee urged elected officials to make hard choices in collaboration with stakeholders to match expenditures with resources and develop a balanced and sustainable budget. Key recommended strategies include:   

  • Use one-time funding only for non-recurring expenditures or to generate long-term savings 
  • Balance service needs as a full-service county 
  • Managing tax burden and County competitiveness
  • Promote the commercial base 
  • Develop a sustainable and balanced long-term financial plan 

As we transition from a County of significant growth, to one of moderated growth, and expanding, diverse needs, we will need to balance our investments in different ways to support this community. This year’s committee did a tremendous job of taking in a lot of different data points and coming up with recommendations that support that balanced approach.  Although we have many challenges in front of us, this community is strong and together we will find ways to meet those challenges.

Steve Poynot
SAAC Vice Chair

“It is well documented in the 2023 report and other publications that Howard County is full of noteworthy amenities and features,” said Leonardo McClarty, SAAC Member, President/CEO, Howard County Chamber. “These community attributes cause residents to have extraordinary expectations, yet we are reaching a place where our needs and wants will conflict, leading our elected officials and community leaders to have serious debates as to how we grow in the future.”

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