FY 23 Approved Budget Book

First, the five percent assigned balance, and additional reserves, helps to ensure healthy County operations and services during recessionary conditions or due to unexpected shortfalls in revenue. Recent years have proven to be difficult times in which to manage County Government. The wisdom of conservatively managing expenditures and planning for the possibility of economic downturns, or other uncontrollable and unexpected economic forces in recent years, has allowed for steady and consistent operation. Second, the fund balance contributes to Harford County's enviable bond ratings, which are especially important in lowering the County’s borrowing costs. In rating the County's creditworthiness, the rating agencies will review the fund balance when assigning their debt ratings. They will view a County with strong reserves more favorably. General Fund Budget Based upon our review and analysis of procedures already outlined, the Committee recommends that the FY 2023 General Fund Budget increase the FY 2022 Net Adjusted General Fund Budget, of $620.0 million, by 9.2%. This represents approximately $676.8 million in ongoing revenues for FY 2023. Note, based on the current state of the economy, the Committee was concerned over the impact of inflation and the labor shortage to income tax revenues, but also their effect on expenditures both on the operating and capital side. The County budget will be under considerable pressure to fund wage increases, both as it relates to the County Governments workforce and the workforce of the organizations it funds such as the school system, the community college and the library. While much of the capital budget is debt financed and not likely to affect the General Fund in FY 23, the Committee is concerned about the long-term impact of rising III. Recommendations

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