Smoke and Snooker, Promises and Placeholders: Will the Real Cecil County Budget Please Stand Up?

May 19, 2021


Cecil County Executive Danielle Hornberger’s proposed Fiscal 2022 budget, which will go before local residents at a public hearing on Thursday (5/20/2021), has become an ever changing list of promises and wishes—and a challenge to the County Council to figure out what is real or imagined.

In addition, budget worksessions before the County Council disclosed this week that the Board of Elections (BOE) was significantly underfunded in the proposed budget, which covers the next fiscal year in which the BOE will have to implement costly new procedures under legislation passed this year by the General Assembly to expand early voting locations and absentee ballot distribution and processing in 2022. And the county health department also received a cut in county financial support.

But witnesses said they had been assured by Hornberger’s administration that their agencies would get unspecified additional funds later in the year via budget amendments and the proposed budget amounted to placeholders for later actions. Where Hornberger would get the money for additional spending was unclear nor was there a timetable for such action or estimates of how much additional money might be available.

No local budget is ever written in stone and budget amendments throughout the year are common, such as unanticipated state and federal grants to the county or high costs of snow removal during a bad winter. But it is unusual to go into a budget review process by the County Council with so many moving parts and unsubstantiated calculations upon which the lawmakers are supposed to base their decisions

Nowhere is that more evident than in a last-minute calculation on Tuesday (5/18/2021), in which Hornberger suddenly claimed she could get more money out of the bond market than the $580,000 in cost savings she estimated just a month ago. Hornberger’s original proposed budget predicted the savings of $580,000 by going to the bond market and “refunding” or refinancing existing bonds (which cover long term costs of major construction projects) at what is projected to be an unspecified, lower interest rate paid by the county to the lenders.

Facing sustained pressure from citizens angered by a massive $366,202 cut in operating funds for the public libraries that would force reduced operating hours or even closing some branches, Hornberger suddenly told library officials she could turn over an estimated $190,000 in extra funds to the libraries obtained from a new ‘estimate’ of additional cost savings on the bond market. But she said that offer was conditional on the County Council approving her “bond bill.”

Library sources confirmed details of the offer to Cecil Times. Other sources told Cecil Times that just a few days ago, Hornberger circulated a much lower figure for how much extra money she thought she could extract from the bonding plans. And whether or not such extra money could be obtained, it takes time to go to the bond markets and set up an offering, while libraries face immediate needs for help as of 7/1/2021.

At the same time, it is unclear just how much money would really be available for the library or other purposes due to uncertainty over just how much the county could save on bond interest costs. Nationally, interest rates have been rising and there have been inflation fears and warnings from the Federal Reserve that the economy is unpredictable as the nation recovers fiscally from the pandemic. .No one really knows how much money will be “saved” until the county actually tests the bond market waters with an offering.

But while Hornberger’s ever changing numbers are floating in a smoky mist of thin air, another game is apparently being played: snooker, to try to pressure the County Council to give her sole authority to control the county’s access to the bond markets by an executive order.

In addition to her budget, Hornberger sent to the Council separate “bond refunding” legislation (Bill 2021-08) to give her unilateral power to go to the bond markets at any time to refinance county bond debt. Her bill is a much abbreviated, one paragraph version of legislation rejected by the Council last fall. At that time, County Executive Alan McCarthy proposed a similar plan, although with several pages of qualifiers and safeguards that are missing from Hornberger’s one paragraph bill.

A majority of the Council—including some of Hornberger’s most loyal backers—refused to give that authority to the County Executive last fall, saying the Council must have a final say in such matters and executive orders were unacceptable.

So it appears that now Hornberger is trying to use the library as a club to hammer the Council to approve her bond refunding / executive order measure. Library sources said they were advised that the extra money would only be forthcoming if the Council approved her “bond bill.”

The Council does not have the authority, under the county Charter, to increase individual spending items in the executive’s budget proposal and may only cut spending. However, under regular budget rules, Hornberger could send a budget amendment to the Council in the future, seeking approval of an increase in funds for a particular agency or department. But as part of that process, the executive would have to specify where the extra money was coming from—a cut in another program or a sudden increase in available revenues. But a revenue increase would have to be documented—not just a guess or assumption.

The proposed budget will be open to public comment on Thursday 5/20/2021 in an in-person meeting of the County Council in the auditorium at Elkton High School, from 7pm to 9 pm. The Council will listen to public comments but will not respond to questions.

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