FY 25 Harford County Government Proposed Operating Budget

COUNTY BUDGET POLICIES AND PROCESS

Financial Planning A six point plan was designed to address economic cycles and maintain the existing property tax rate. 1. Expenditures will be reviewed and approved based on real versus perceived need. 2. Each function, service, project, and expenditure will be reviewed as to its affordability. 3. New sources of revenue will be identified and advanced. 4. We will prepare and integrate through planning, and maintain conservative annual operating budgets and multi-year spending plans. 5. We will plan for and preserve a prescribed year-end fund balance to maintain our credit rating, and to provide for emergency needs. 6. We will develop and implement a Ten Year Capital Program based on affordability and sound debt management practices. Strategic Planning The Business Plan also incorporates ten principles of sound financial management. 1. The planning system in the County will continue as a dynamic process which is synchronized with the Capital Improvement Program and Operating budget. The County’s Land Use Plan shall not be allowed to become static. There will continue to be a periodic review of the plan at least every five years. 2. Harford County must continue to diversify its economic base by encouraging commercial employment and associated revenues in order to increase the assessable base within the County. 3. Annual budgets shall continue to show fiscal restraint. It is imperative that a positive cash balance (surplus) be shown in the General Fund at the end of the fiscal year. A managed operational (contingency) reserve shall be maintained in the General Fund at a level sufficient to provide temporary financing of unforeseen needs of an emergency nature. The reserve will be maintained at a level not to exceed 3% of the General Fund, and any other fund, in any given fiscal year per Section 506(6) of the County Charter. A managed reserve shall also be maintained as part of the General Fund. The reserve shall be maintained at a level not less than 5% of the total General Fund disbursements in any given fiscal year. 4. If a deficit appears to be forthcoming, the County Executive shall direct that a freeze be placed on personnel hiring and new capital expenditures. 5. Harford County’s cash management system must continue to receive full support and cooperation from all County agencies. Such a system is an indication of the soundness and professionalism of the County’s financial management process. 6. All efforts must be made to improve the productivity of the County’s programs and its employees. The County’s productivity analysis process is a dynamic part of the administration. 7. Continuing effort must be made to reduce duplicative functions within the County government and the autonomous agencies, particularly those which receive appropriations from the General Fund. 8. The County’s debt ratios shall be maintained at the following levels: a. Net Bonded Debt is to be maintained at a level no more than 2.3% of the full case value of assessable property in the County. b. Bonded debt and its resulting debt service are to be kept at a level not higher than 10% of the General Fund Budget. 9. Self liquidating bonds will only be issued after a careful analysis is performed to ensure that revenue sources are properly in place in order to protect the fiscal soundness of the County.

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