McCarthy Marks 100+ Days as Cecil County Exec at CBL Event; Warns of ‘Empty Bag’ in County Finances

March 30, 2017

Cecil County Executive Alan McCarthy reflected on his four months in office Thursday (3/30/2017) as a “hectic” but “educational experience,” with steps already taken to reorganize county government, re-order transportation priorities, and promote business development. But he warned that the county faces a fiscal “empty bag” due to stalled revenues, rising costs, state spending mandates and past county government policies.

McCarthy spoke at an event sponsored by the Cecil Business Leaders for Better Government (CBL), a political action committee that supported his candidacy in the 2016 elections, at Schaefer’s in Chesapeake City. The gathering was billed as marking the new county executive’s first 100 days in office, but the timing was a bit off: McCarthy said his calendar pegged his tenure as 117 days, “but who’s counting?”

The new county executive will unveil his first budget on Friday, for the 2018 Fiscal year, and without going into any financial details, McCarthy indicated that there would be difficult choices ahead. And he said he would not take the easy way out of past county leaders to raid emergency reserve funds to balance the budget.

Key factors, he said, are the fact that the local economy and residents’ incomes are still recovering from the recession and the state’s shifting of many costs to county governments. The state “really stuck it to Cecil County and other jurisdictions by transferring teacher pension costs” and eliminating most highway user revenues to the counties at the same time. The state “solved its budget problems by foisting a bundle of unfunded costs upon local government, while at the same time basically eliminating critical revenue streams,” McCarthy said.

Some of the problems are of the county’s own making, under past policies that deferred maintenance costs as “a budget strategy” that actually created a “financial hole that just gets deeper and deeper,” he said.

And he criticized past county government reliance on reserve funds– known as the “unassigned fund balance,” that had been set aside over many years as a cushion against fiscal and weather adversity– as a quick-fix to balance recent budgets rather than make tough budget decisions.

“For too many years we have failed to address the balancing of revenues, with the impact of inflation and the increasing cost of doing business. As a result, we have been left holding an empty bag,” McCarthy said. And the local budget has relied too much on draining the reserve funds. “This must stop,” he said, adding that the budget must be balanced with current revenues.

McCarthy said that over $11 million had been drained from the reserve funds over the past four years and “I must, and will, stop this.”

While McCarthy mentioned no names, his predecessor, Tari Moore, consistently raided the reserve funds every year of her tenure while freezing the property tax rate and boosting spending substantially for schools and other projects.

Meanwhile, McCarthy cited several changes he has already made in county government, including consolidating building and related permits in a new agency, using existing staff from three departments, to create a one-stop shopping destination to streamline the process for businesses and citizens. [ SEE previous CECIL TIMES report here: ]

A new multi-year plan for using state “impact aid” from the Hollywood casino in Perryville calls for using the funds to invest in “wastewater infrastructure along Route 40,” he said, instead of tapping the money for day to day operating expenses. McCarthy emphasized that expanding infrastructure in the growth corridor between Rt. 40 and I95 must finally be built after decades of delays in order to boost job creation and economic development.

And growing problems with rising county employee health costs, which have repeatedly exceeded budget targets in the past two years, are being addressed through McCarthy’s order to shift funds into the insurance fund to “make it financially sound,” he said.

The CBL event drew a crowd of local business owners and political activists as well as all five members of the County Council who, like McCarthy, are Republicans.

Mario Gangemi, a board member and vice chair of the group, told the crowd that CBL was different from other political committees because it not only supports candidates who have filed in a local campaign but also “recruits” candidates that are perceived as pro-business to run for office. “And we’re not going to apologize for that,” he said.

So far, CBL has a 100 percent success rate, with all of the candidates it supported in elections since 2012 winning their races.

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3 Responses to McCarthy Marks 100+ Days as Cecil County Exec at CBL Event; Warns of ‘Empty Bag’ in County Finances

  1. Joe C on March 31, 2017 at 3:59 pm

    He failed that he voted FOR all of the Moore budgets while he was on the council!How can you be pro business when you are raising taxes (income and real estate) on small businesses? I now know why there is no recall provisions in the charter, because he would be gone!

  2. Russ Johnson on March 31, 2017 at 8:54 pm

    For the last 4 years Dr McCarthy voted in favor of those budgets that relied on raiding the fund balance, even though as a member of the County Council he was in a position to lead the charge against utilizing that strategy, and didn’t.

    His proposed budget isn’t “balanced with current revenues.” as he states. It’s balanced with tax increases–5% property and 7% income. He prefaces all of this with “Key factors are the fact that the local economy and residents’ incomes are still recovering from the recession…” So let’s grow the size of county government on the backs of those “still recovering” with multiple, sizable, tax increases.

  3. scott carlson on April 1, 2017 at 8:13 pm

    I can’t imagine why Hogan, like past Governors, have bypassed Cecil County in grant monies, again. When the County Executive slams his budget, doesn’t follow the tier map laws, what do you expect?
    Allen’s first move was to increase County spending by hiring in new people. Will it pay off? He has also been on the council for how many years? You can’t play the new guy card anymore. Sad…

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