Leggett proposes modest spending increase

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County Executive Ike Leggett.  FILE PHOTOCounty Executive Ike Leggett.      FILE PHOTO  Calling it a prudent attempt to guide Montgomery County through fiscal uncertainty, County Executive Isiah Leggett (D) released the final budget proposal of his last term as county executive Thursday, putting forward a $5.56 billion operating budget – increasing spending by 2 percent – for Fiscal Year 2019, with most of the increase directed to Montgomery County Public Schools.

“This budget continues my commitment to prudent fiscal policies critical to sound fiscal management,” Leggett said. “I have increased our reserve levels to cushion the taxpayers against any future unanticipated economic setbacks and included the required level of funding for retiree health benefits."

Leggett had stressed caution in the weeks leading up to the budget announcement, promising that it would not include a property tax increase, with the caveat that it was unlikely that he would propose drastic spending increases in most areas thanks to the current budget’s $120 million shortfall.


Facing staff shortages, Takoma Park discusses upcoming budget

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Takoma Park Govt logoTAKOMA PARK — With the upcoming budget season, some of Takoma Park’s department managers asserted at a priorities meeting on March 1 that current staff shortages limit the ability of municipal departments to carry out the objectives laid out by the City Council.

“Our workload exceeds our staff capacity by an amazing amount,” said Sarah Anne Daines, the city’s Housing and Community Development director. “There’s a lot of commitment in terms of staff, time and energy in making those efforts come to reality.”

As the City Council discussed its budget priorities for the 2018-19 fiscal year, several other department managers said they run programs with limited staff.

“We have a small city staff that does a great deal and their commitment to carrying out the Council’s priorities has been terrific,” Mayor Kate Stewart said. “With a small staff, it’s important to recognize the need to possibly add more staff.”


County budget process runs into new problems

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MoCo LogoGERMANTOWN — The budget process for County Executive Isiah Leggett’s last year in office takes place during a time of uncertainty.

Leggett has bragged to residents about the County’s low unemployment rate, its “triple A” bond rating and its growing reserves, as he has toured the County to talked to residents as part of his series of annual budget forums. Yet, as the term-limited Democrat prepares to submit his final budget to the County Council by March 4, the County that Leggett has served for many years is in the grips of an unexpected budget shortfall.

“My first objective is to try to do no harm,” Leggett said, “to provide the services and the programs for the things that we are already funding where it makes sense for us to continue that. Once we achieved that objective, then I would look to try to expand beyond that depending on the level of resources available.”


Rockville optimistic about budget status

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Even as Montgomery County prepares for significant budget cuts to cover the $120 million budget shortfall that finance officials discovered for this fiscal year, Rockville City officials said their budget revenues are looking just fine.

“It’s an interesting contrast between the County and the City, in my opinion, the county always budgets to the bone and to have a budget crisis is pretty much usual,” said Rockville City Council Member Mark Pierzchala.

Last week Montgomery County officials suggested that the cause of the $120 million budget shortfall was a downturn in income tax receipts, which they attributed to choices made by large investors in anticipation of a large tax break from the Republican tax bill, which President Trump has pledged to sign early next year.


Berliner says “NO” to cuts in education while Leggett mulls options

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MoCo LogoROCKVILLE — No program is safe from cuts as the County seeks to mitigate the effects of a projected budget shortfall next fiscal year, County Executive Isiah Leggett (D) said.

Last week Leggett announced that the County officials were anticipating a large unexpected budget shortfall, and asked that each County agency consider cutting two percent of their budget.

The sudden shortfall caught County finance analysts and council members by surprise as they based their $5.4 billion budget for the fiscal year 2018 off of much greater revenue projections.

"For me, everything is on the table, and you try to work through the particular details," Leggett said of the coming budget cuts.


Council gives MCPD gang money

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MoCo LogoOn Tuesday the County Council agreed to give the Montgomery County Police Department and the Montgomery County State’s Attorney’s office a combined $843,693 to fight the County’s rising gang problem.

The money, which the Council approved unusually quickly immediately after the public hearing without a Public Safety Committee meeting, will allow the State’s Attorney’s office to start a new gang unit and allow the police department to better organize their efforts on combating gang violence.

“I did not want an additional week to go by without our taking this matter up, getting a public hearing scheduled so we could act on the same day,” said Council President Roger Berliner (D-1).


Spare Part Woes

Broken Promises - Bad Dreams, A Metro Investigation (Third in a series)

FTA concerned with the latest in Metrorail’s budget problems

Metro entranceA problem with spare parts finds The Washington Metropolitan Area Transit Authority once again in trouble with the Federal Transportation Administration.

Metro is now accused of dodging FTA procurement regulations.

According to the proposed FY2018 budget, WMATA charged $23 million in railcars to the operating budget because Metro managers were having difficulty complying with FTA requirements. Those funds apparently should have been charged to the capital budget.

According to the Approval of FY2018-2023 Capital Improvement Program and CFA extension that $23 million was spent on parts “necessary for railcar safety and reliability.”

According to that same report, the money was moved not only because some parts were not procured in compliance with federal regulations but also “a lack of available non-federal capital funding.”

Tom Bulger, a member of the Metro board of directors, said he wasn’t aware of this specific move of money, but he was aware of alterations to the procurement process to ensure that Metro had parts to repair things.

“I’m aware of the fact that we were running out of spare parts at a fast clip since 2016 and they {Metro} needed to get more supplies in order to keep up with maintenance and the procurement process was accelerated,” he said.

When asked why Metro was running out of parts, Bulger assigned blame to the suppliers.

“Supply. Logistics. The suppliers were behind. We weren’t able to obtain the parts on a schedule that would meet Metro’s requirements.”

Those alterations to the procurement process are part of The Parts Bridging Program, a program started by WMATA to “temporarily purchase parts using non-Federal funds and procurement rules until December 2017,” according to the Approval of OneYear Extension of Parts Bridging Program (PMP) and Update on Parts Procurement Program. Last October, the enrollment deadline was extended until December 31 of this year and the initial contract end date was extended until June 30, 2023. According to that report, the program was started after a board resolution imposed “heightened standards on parts procurement.”

However, according to that same report, Metro was also running out of parts. The report states that “In the 2015 Annual Vital Signs Report, the Office of Performance (CPO) noted its findings that the high non availability rates of revenue service vehicles were attributable in part to inventory part shortages throughout the warehouse system. This shortage of inventory parts was having an adverse effect on safety and on time service within the transit system.”

According to that report, “the existing procurement methods used by Metro could not correct this deficiency.”

According to the documents, a goal of the program is to - after the fact - request waivers for contracts that didn’t follow FTA regulations or be eligible for reimbursements from the FTA from any given part in the program.

According to FTA spokesman Steven Taubenkibel, the use of local funds is a local decision.

WMATA has been accused of breaking FTA regulations before.

In 2014, a damning FTA audit revealed WMATA’s misuse of grant money, which included WMATA incurring unallowable expenditures and underreporting $42 million in federal expenditures. According to the report, WMATA also offered a contract without soliciting the three bids necessary to make that contract competitive. According to the 2014 audit, Metro didn’t have the internal controls to properly manage their grant money, although the final report of the audit included documents that acknowledged Metro’s progress on improving its internal controls.

Carol Kissal, the CFO of the Metro at the time and the person to whom some of the problem departments reported too departed.

“It’s all been cleaned up as far as I know,” said Bulger. “It better be.”

“When the changeover came there was a different way for accounting for hours spent and parts and personnel that seems to be working better,” he said about the changes to Metro’s operations after the audit. And we brought in a new CFO from Chicago.”

FTA today still requires Metro to carry out corrective actions for safety and they oversee how WMATA uses federal grant money. According to the FY2017 budget, WMATA’s operating personnel budget decreased by $21.6 million, primarily because WMATA moved expenses for the required safety actions to the Capital Improvement Program. In that same year, that decrease was offset by increases for FTA required safety actions.

Earlier, FTA diverted a large sum of money into safety spending

According to FTA correspondence with WMATA, FTA diverted $20 million of non-safety spending into safety spending, $10 million away from pressure washing and cosmetic maintenance of the stations and $10 million away from open bankcard and automatic fare collection systems. They then put that money into SafeTrack.

FTA management is also apparently unhappy with the local governments and their failure to provide for adequate safety oversight for local transit. According to FTA correspondence with local governments in early 2017, FTA withheld federal grant money from local transit companies, including Metro, until a new safety oversight program could be certified and it is unclear if that has even happened yet.

“The U.S. Department of Transportation advised the Governors and Mayor that their respective jurisdictions may be subject to the withholding of up to five percent of their FY 2017 Urbanized Area formula funds if they did not collectively establish a State Safety Oversight Program (SSOP) for the rail operations of the Washington Metropolitan Area Transit Authority (Metrorail), certified by FTA, by February 9, 2017,” reads the correspondence. “They have not met that deadline.”




The Fed isn’t the enemy folks

constitution quill penPrivatization of the federal workforce was a goal of Ronald Reagan during his administration. He convened the Grace Commission to look into how best to do just that. Now, more than thirty years later, the number of contract employees compared to career federal employees approaches a five to one ratio.
Clearly, there are some benefits to contracting out some very skill-specific functions, but the value of a properly staffed and experienced federal workforce should not be taken lightly. Nor should a dedicated federal workforce that is sworn to uphold the Constitution and not the profit motive of the company winning a federal contract be something that is taken for granted.
Placing the burden of the federal deficit on the shoulders of the federal workforce is doing exactly that and is certainly not cost effective.


Metro faces severe budget trouble

metro logoWith ridership continuing to decline, revenues from fares also decreasing despite rate increases and at least a half a dozen pending lawsuits with claims of one million dollars or more, Washington Metropolitan Area Transit Authority trains continue to chug along, in part, thanks to an influx of government money.

“A primary cause of Metro’s current budget challenge is the decline in rail ridership. Total rail ridership peaked in 2009 and has stagnated or declined each year since then,” Paul Wiedefeld, WMATA General Manager/CEO, wrote in his executive summary of this year’s Fiscal Budget, which began July 1.

The $3.1 billion FY 2018 proposed budget includes $1.8 billion for operations and has more expenses than income in the 186 page-budget. Money for operations includes $841 million from fares, parking and advertising, and another $976 million from government funding from Maryland, D.C. and Virginia.

Metro’s total operating budget is very dependent upon the government, noted a spokesman from the National Society of Accountants, who reviewed recent budgets for the Sentinel.

“This thing is bleeding, but it is propped up by government funds,” the spokesman said. “There has been a substantial drop in the use of the Metro.”


Council gets its turn to comment on budget

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MoCo Logo

ROCKVILLE – Last week the County Council heard from the residents. Now it has its chance to craft a budget.

After County Executive Ike Leggett released his $5.4 billion proposed budget in March, the Council took comments from the community in a series of public hearings before it deliberates during the next month or so to craft a budget.

Unlike last year in Leggett’s proposed budget, this fiscal year’s does not contain any considerable tax increase, and Council President Roger Berliner (D-1) said a tax increase over the County charter limit is not on the table this year.

Many of the people who showed up last week to testify asked the County to fund their particular interests, whether they are Montgomery College or one of the County’s nonprofit partners such as Manna Food Center.

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