Lagging tax revenue is failing to keep up with expenses in Prince George’s County, according to a report released Tuesday, and if nothing is done to fix it, the government could face a $250 million budget hole by 2022.
One week before County Executive Rushern L. Baker III (D) is expected to present his proposed 2017 budget to the council, a preliminary report from a blue-ribbon commission says that years of tax caps, expensive labor agreements and a reluctance to raise fees have left the county with a worsening structural deficit.
Baker and lawmakers have cut some spending, incrementally raised taxes and used rainy day funds to shore up budget gaps in recent years. But the report suggests that more drastic changes are needed.
“Without affirmative steps, the county’s fiscal health is in jeopardy,” commission chair Earl Adams Jr. said after a presentation to the county council Tuesday. “It’s a dire situation that needs to be dealt with. We have a hole, it’s got to be filled and we’ve got to come up with solutions.”
The report cited rising personnel and public education costs, lagging income-tax revenue, and mandated limits on the county’s ability to raise revenue as factors that contribute to the budget challenge.
“The County is not as wealthy as it may appear,,” the report said, noting that Prince George’s collects about $800 less per capita in income tax than neighboring Montgomery County.