Baltimore’s revenue is expected to decline $68.7 million in the current fiscal year, which ends June 30, and the city is forecasting revenue will decline by $103 million in the next fiscal year due to the coronavirus’ crippling effect on the local economy.
Officials anticipate a budget deficit of $42.3 million due to the decrease this year.
Budget Director Robert Cenname presented the 2021 budget to the Board of Estimates this morning, but as he said there and during a press conference outside City Hall on Wednesday, the document is “irrelevant” due to the projected revenue dips.
Cenname’s office was putting the finishing touches on the budget in early March, when the health crisis began to escalate in the U.S., and did not have time to make revisions.
Henry Raymond, director of the Department of Finance, and Cenname said the city is seeing considerable income disappear due to losses in taxes and fees associated with tourism and the convention business, as well as the money collected from parking fines, city-owned parking garages and traffic cameras.
On March 24, the city suspended parking enforcement and meter fees to protect municipal workers.
Raymond and Cenname said the city will likely lose some income tax revenue as more and more people who have lost their jobs due to the pandemic file for unemployment.
In anticipation of these declines, Mayor Bernard C. “Jack” Young on March 20 instituted a freeze on new hiring and non-essential spending. The freeze does not apply to positions for police officers, paramedics, firefighters, EMTs, sheriff’s deputies and other essential personnel in the city’s response to the virus.
Non-essential spending includes office supplies, travel requests and new equipment that doesn’t help the city in its coronavirus response.
The city has also taken a series of actions to reduce services to core operations, such as suspending bulk trash pick-up and graffiti clean-up, street and alley cleaning, non-essential construction and maintenance, and other services, and closing three trash and recycling sites.
Young said he is meeting with members of his administration later this week to begin amending the 2021 budget. He said officials have not yet discussed laying off city workers.
But he conceded, “If we don’t have revenue, everything has to be on the table.”
The mayor renewed his call for the Trump administration to provide a bailout for cities. The first round of stimulus included funds for major corporations but nothing for municipalities that are getting hit hard by the pandemic.
And Baltimore is not alone, he said, noting that the surrounding counties are having similar conversations about budget cuts.
“I’m hoping that our president is listening because bailing out banks and major corporations and forgetting cities that actually do the work on the ground–we’re where the rubber meets the road,” he said. “And we need the help.”
The $3.98 billion preliminary budget presented today includes $34 million for school construction as part of the state’s “Built to Learn” law, $4.8 million for nine data centers to respond to crime and $216 million to upgrade and modernize the city’s IT infrastructure almost a full year after Baltimore was the victim of a ransomware attack, among other initiatives.
The Board of Estimates, made up of the mayor, council president, comptroller, the director of the Department of Public Works and city solicitor, will present the budget and take input from citizens at a virtual edition of the annual Taxpayers’ Night, scheduled for April 7 from 6-8 p.m.
A final budget is due to the board on May 6. It then moves to the city council.