Sec. 20-61. Affordability Indicators.

   (a)   Factors. In adopting guidelines, the Council should consider, among other relevant factors, the condition of the economy, the level of economic activity in the County, trends in personal income, and the impact of economic and population growth on projected revenues.

   (b)   Advice. To assist the Council in adopting guidelines, the Finance Director must each January, and at other times as necessary, consult with independent experts, who need not be County residents, from major sectors of the County economy. The experts should advise on trends in economic activity in the County and how activity in each sector of the economy may affect County revenues. The Director must report the experts’ views, if any are received, to the Executive and Council. (CY 1991 L.M.C., ch. 30, § 1; 1997 L.M.C., ch. 35, § 1; 1999 L.M.C., ch. 21, § 1; 2008 L.M.C., ch. 32, § 1.)

Sec. 20-62. Approval of Aggregate Operating Budget.

   Any aggregate operating budget that exceeds the ceiling on the aggregate operating budget adopted under Section 20-60(c) requires the affirmative vote of 8 Councilmembers for approval. (CY 1991 L.M.C., ch. 30, § 1; 1992 L.M.C., ch. 30, § 1; 1997 L.M.C., ch. 35, § 1; 2008 L.M.C., ch. 32, § 1; 2022 L.M.C., ch. 40 , § 1.)

   Editor’s note—See County Attorney Opinion dated 10/30/91-A describing the additions to Charter § 305 by Question F as not conflicting with the TRIM amendment.

   1999 L.M.C., ch. 5, § 1, states: "Notwithstanding any provision of Chapter 20 of the County Code to the contrary, including Section 20-60(c)(4) and Section 20-62, the County Council may increase the spending affordability guideline for the aggregate operating budget for fiscal year 2000 by more than 1% over any guideline previously adopted.

Sec. 20-63. Recommended Budget Allocations.

   (a)   Applicability. For each fund or budget included in the aggregate operating budget, in the resolution adopted under Section 20-60(c)(1) the Council must adopt separate budget allocations for County government, the Board of Education, Montgomery College, and the Maryland-National Capital Park and Planning Commission, and for debt service and current revenue funding of capital projects.

   (b)   Expenditure Reductions. If a budget submitted to the County Council exceeds a budget allocation adopted under subsection (a), the County Executive (for the County government budget) and the governing board of the agency that prepared the budget must recommend by March 31:

      (1)   prioritized expenditure reductions that would be necessary to comply with the adopted budget allocation; and

      (2)   a summary of the effect on the agency’s program of the recommended prioritization.

   (c)   Added Information. If the Executive or an agency submits a proposed amendment to the operating budget to the Council after the Executive has submitted the annual budget, and the proposed amendment would cause the budget for County government or the agency to exceed the budget allocation adopted under subsection (a), the Executive or the respective agency must include with the amendment the information required in subsection (b). (CY 1991 L.M.C., ch. 30, § 1; 1992 L.M.C., ch. 30, § 1; 1997 L.M.C., ch. 35, § 1; 1999 L.M.C., ch. 21, § 1; 2008 L.M.C., ch. 32, § 1.)

Article XII. Revenue Stabilization Fund. 1

 

Notes

1	*Editor’s note—This article is derived from 1993 L.M.C., ch. 41, § 1. Section 2 declared the provisions effective fiscal year 1995, i.e., July 1, 1994.

Sec. 20-64. Findings and declaration of purpose.

   Montgomery County, along with the State of Maryland and its other political subdivisions, has recently experienced substantial funding shortfalls. The State, in order to allow its political subdivisions greater budgetary and fiscal flexibility in addressing those shortfalls, has authorized political subdivisions to establish "rainy day" or reserve accounts to accommodate future funding shortfalls.

   It is in the best interest of the citizens of the County that a Revenue Stabilization Fund provide the County with greater budgetary and fiscal flexibility to address funding shortfalls.

   The Revenue Stabilization Fund created in this Article is designed to accrue a balance during periods of economic growth and prosperity, when revenue collections exceed estimates. The Fund may be drawn upon during periods of economic slowdown, when collections fall short of revenue estimates. (1993 L.M.C., ch. 41, § 1.)

Sec. 20-65. Definitions.

   In this Article the following terms have the following meanings, unless the context clearly indicates a different meaning:

   Actual total revenues means the combined total of income tax, real property transfer tax, recordation tax, and investment income, as reported in the County’s annual financial report.

   Adjusted Governmental Revenues means tax-supported County Governmental Funds revenues, plus revenues of the:

   (1)   County Grants Fund;

   (2)   County Capital Projects Fund;

   (3)   tax supported funds of the Montgomery County Public Schools, not including the County’s local contribution;

   (4)   tax supported funds of Montgomery College, not including the County’s local contribution; and

   (5)   tax supported funds of the Montgomery County portion of the Maryland-National Capital Park and Planning Commission.

   Director means the Director of the Department of Finance.

   Excess revenue means the amount, if positive, by which actual total revenues from the income tax, real property transfer tax, recordation tax, and investment income of the General Fund for the fiscal year exceed the original projections for these amounts.

   Fund means the Revenue Stabilization Fund created under this Article.

   General Fund means the general operating fund of the County which is used to account for all revenues and expenditures, except revenues and expenditures required to be accounted for in another fund.

   Income tax means the County income tax imposed under state law.

   Investment income of the General Fund means income derived from the investment of revenues from the General Fund.

   Original projection means the projection of total General Fund revenues for the next fiscal year approved by the County Council in the “Schedule of Revenue Estimates and Appropriations” resolution or any similar resolution.

   Real property transfer tax means the tax imposed under Sections 52-19 et. seq.

   Recordation tax means the tax imposed under Sections 12-101 et. seq., Tax-Property Article, Maryland Code.

   Revised forecast means any revised projection of total General Fund revenues for the next fiscal year prepared by the Department of Finance.

   Total reserve means the sum of the reserve in the Fund plus the Unrestricted General Fund Balance.

   Unrestricted General Fund Balance means the residual portion of the General Fund fund balance that has not been reserved, restricted, or encumbered for later year’s expenditures.(1993 L.M.C., ch. 41, § 1; 2010 L.M.C., ch. 33, § 1.)

Sec. 20-66. Revenue Stabilization Fund.

   (a)   The Director may establish a Revenue Stabilization Fund to support appropriations which have become unfunded.

   (b)   The Fund is continuing and non-lapsing.

   (c)   The Fund is in addition to any surplus that is accumulated under Section 310 of the County Charter. (1993 L.M.C., ch. 41, § 1; 2010 L.M.C., ch. 33 § 1.)

Sec. 20-67. Reserved.

   Editor’s note—Former Sec. 20-67, derived from 1993 L.M.C., ch. 41, § 1, was repealed by 2010 L.M.C., ch. 33, § 1.

Sec. 20-68. Mandatory contributions to Fund.

   The mandatory annual contribution to the Fund must equal the greater of:

   (a)   50 percent of any excess revenue; or

   (b)   an annual amount equal to the lesser of 0.5 percent of the Adjusted Governmental Revenues or the amount needed to obtain a total reserve of 10 percent of the Adjusted Governmental Revenues. (1993 L.M.C., ch. 41, § 1; 2010 L.M.C., ch. 33, § 1.)