Cecil County Budget: Another ‘Happy Meal” Property Tax Cut Trims Half-Cent Off Rate

May 22, 2012

The Cecil County Commissioners Tuesday adopted operating and capital improvement budgets that will give property owners their second consecutive “Happy Meal” tax cut— yielding savings of about the cost of a family’s fast-food meal—while delaying many construction projects.

But unlike last year’s contentious budget process, this year the County Commissioners were unanimous in their support of the Fiscal 2013 budget plans, and several members praised their colleagues for the civil tone and collegial attitude that Commissioners displayed in this year’s budget process.

And unlike last year’s budget—which hit the county public schools hard and siphoned teacher and staff support funds from the schools’ operating budget for a last minute half-cent cut in the property tax rate– this time around the overall county capital (construction) budget took the hit, by delaying projects and the costs that would have been paid out in Fiscal 2013, which begins 7/1/12.

As a result, the county will knock off a half-cent from the “constant yield” property tax rate—defined as the amount of property tax revenues needed to equal those of the previous budget year—that the Commissioners had earlier proposed and put out to a public hearing two weeks ago.

The final action on Tuesday, approved by a unanimous vote of all Commissioners, set a property tax rate of .9907 cents per $100 of assessed property value. Earlier, the proposed budget put out to public hearing had called for a rate of .9957 per $100 of assessed property value. Consequently, the approved tax rate is a half-cent lower than previously proposed.

In practical terms, the impact for owners of a home valued at $100,000 by state property assessors amounts to $5, or $10 for owners of a home valued at $200,000. Make those plans for a Happy Meal visit to Mickey D’s, folks.

But in fact, that Happy Meal benefit does not account for the declining home values in the county that actually required a slightly higher overall property tax rate than last year’s figure just to achieve the “constant yield” tax rate—producing the same amount of property tax revenues to the county as last year. As a result, the property tax rate will rise a tiny bit, from .9401 cents per $100 now to the new rate of .9907 in the new budget

So maybe the average family will have to serve those down-sized burgers at home, with no night out at the fast-food place.

In broader terms, there is a significant change in the final approved budget in contrast to the proposed spending plan of just a few weeks ago: a dramatic reduction in the amount that the budget taps into reserve funds, or the county’s “fund balance” that is set aside for contingencies and emergencies.

Initially, the new budget called for hitting the reserve or “fund balance” by about $3 million, including a set-aside for the anticipated $2.4 million cost of the state’s plan to shift part of the cost of teacher pensions to the counties.

[SEE previous Cecil Times report on the initial Fiscal 2013 budget proposal here:

But, due to slashing of several construction proposals, in the past two weeks the Commissioners reduced their reliance on the reserved money to just $612,436.

County Commissioner Tari Moore (R-2), told Cecil Times she was very pleased that the Commissioners vastly reduced their reliance on those emergency funds in the new budget. She had voted against last year’s budget because she felt it irresponsibly tapped those funds.

Last year’s budget raided the “fund balance” by $1.64 million, prompting Moore to vote against that budget.

[SEE previous Cecil Times report on last year’s budget battle here:

“We needed to be responsible,” Moore said Tuesday. “We don’t know what’s coming in the future.” One thing that is clear, she added, is that the state will continue to dump an ever increasing share of teacher pension costs on the county next year. Moore, who is the Republican candidate for County Executive in the November election, added that the county is facing “a lot of unknowns” as it transitions to Charter government in the next year and it is prudent to leave some funds aside to deal with possible unforeseen costs.

In adopting the new budget, Commissioner Robert Hodge (R-5) commended his colleagues, saying, “Instead of contention and conflict, we, the Commissioners, communicated civilly” on the budget. “I’m pleased we were able to do that.”

Commissioner Diana Broomell (R-4) said she was “pleased with the budget” and called it “a fiscally responsible budget.”

In the newly revised county budget, Commissioners slashed construction spending for various road, bridge and related building projects. And the budget cut spending for Cecil College construction projects by $242,000. College president Steve Pannill attended the budget session Tuesday and appeared in good spirits and health after a serious car accident put him in the hospital briefly a week ago.

Overall, the Commissioners delayed spending on multiple construction projects in the budget year beginning in July—including deferring $370,000 for upgrading security at the Rising Sun library, various road projects at a cost savings of $590,000, and delaying spending for the Port Deposit Tower by $350,000, among other projects. As a result, spending was further reduced from the original budget proposal a few weeks ago by more than $2.3 million.

In all, the county will spend $166,748,807 in Fiscal 2013 for operating expenses.

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7 Responses to Cecil County Budget: Another ‘Happy Meal” Property Tax Cut Trims Half-Cent Off Rate

  1. BobbyG on May 22, 2012 at 8:55 pm

    The worst part about this Happy Meal tax cut is that I hear that they have eliminated the toy.

  2. Patrick Tuer on May 22, 2012 at 10:32 pm

    Kudos to the Commissioners for working together!

  3. Russ on May 23, 2012 at 8:51 am

    Wow, they finally all agree on something. Raise the property tax rate 5.4%, making it the highest rate in Cecil County history (or at least over the last decade)!

  4. Ronald on May 23, 2012 at 9:28 pm

    It was commendable that five commissioners were able to agree on the budget.
    It also makes me wonder how New Castle Co. which is much bigger than Cecil Co., was able to pass a budget under $167 million dollars which is comparable to Cecil County’s passed budget.

    Both counties are putting off some capital projects, so all in all, was the Cecil County budget such a big accomplishment?

    • Jackie on May 24, 2012 at 12:40 pm

      New Castle County’s Operating Budget is available here: http://www2.nccde.org/finance/Documents/BudgetDocuments/FY2013%20Approved%20Operating%20Budget%20smaller.pdf

      According to that document, the approved operating budget for FY2013 in New Castle is over $247 million dollars. Also, the captital budget adds another $17 million. In addition, in my reading of the New Castle County budget, I didn’t see any reference to costs to operate the school system, but I did find school tax information on the Christina School District’s website, which leads me to believe that the school budget is entirely separate from the county budget.

      Pennsylvania operates the same way. In PA there is a local tax levied by the county for things like roads, public safety, etc, and then a separate tax is passed by the local school board to pay for the public schools.

      We are entirely different in that our local government (not our school board) makes the final decision on the school budget, and our local budget includes everything. So not only is New Castle County’s budget almost $100 million more than Cecil County’s budget, it also does not include the school budget which comprises almost 40% of our local budget.

      The comparison between New Castle and Cecil counties is nonexistent. It would be fairer for you to compare tax rates between the two counties, but you would have to be sure to include school taxes for New Castle.

  5. Taxpayer on May 26, 2012 at 7:32 am

    Why is charter government going to cost more money? When charter was “sold” to the citizens of this county we were told it would cost less. Now we hear rumblings that we need to save money to pay for charter??? Is it time to start a movement for Code Home Rule??

    • Russ on May 28, 2012 at 1:11 pm

      Charter could be implemented without spending more or raising the property tax rate. The problem is that none of the 5 Commissioners had the courage to dig deep and make the necessary cuts. It was much easier for them to just raise taxes, believing that we will all forget by election time that they voted for, and implemented, the highest property tax rate in the history of the County. I guess we will find out if their gamble paid off come November, but sadly I believe that apathy in the electorate will just let it roll.

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