A Montgomery County Council committee recommends borrowing about $2 billion — $180 million more than Executive Isiah Leggett (D) said is fiscally responsible — during the next six years to pay for construction projects.
The committee voted 2-1 on Monday to take on $320 million in debt in each year of the county’s six-year building plan, $1.92 billion total. Leggett recommended borrowing $295 million each year.
The county’s most recent capital budget called for $4 billion — about half from borrowing money — in construction projects. The spending affordability guidelines considered by the council committee represent a portion of the funding for those projects.
Council President Valerie Ervin (D-Dist. 5) of Silver Spring and Councilman Hans Riemer (D-At large) of Silver Spring, voted for the greater amount. Councilwoman Nancy M. Navarro (D-Dist. 4) of Silver Spring was opposed.
A spokesman for Leggett would not say whether the capital budget he plans to propose in January would include the higher level of borrowing if the full council approves that level next month.
“We believe [$295 million] is the right level to be at,” Lacefield said. “I think the assumption is we’re going to submit a capital budget that we think is at the right level.”
He said the committee’s recommendation takes the county in the wrong direction.
“We’ve got to be reducing our capital spending,” Lacefield said. “We’ve got to be reducing the amount of debt service we pay for in the operating budget, and we’ve got to be protecting our AAA bond rating.”
In August, Leggett announced his intention to reduce the amount of money the county borrows for construction projects by $150 million during the next six years to reduce the county’s debt and rein in spending as the economy recovers.
Riemer disagreed with Leggett’s proposal, saying building costs are, in some cases, 30 percent lower than they have been in the past. He said it is a good time to build, which, in turn will create jobs and needed revenue.
The county’s Director of Management and Budget Jennifer Hughes disagreed with that assessment.
“It’s very hard to jump start an economy at such a localized level,” she said.
Ervin said the council could scale back the capital budget when it considers spending guidelines again in February.
However, a council adviser said that would be a first.
“There’s no way the council is going to lower the guidelines in February,” said Glenn Orlin, deputy council staff director.
Navarro, chair of the Government Operations and Fiscal Policy Committee, said adding projects to the capital budget in the fall and removing them next year will be more difficult — and more troubling to agencies and the community that are expecting the construction projects.
In August, Leggett called on county agencies to recommend cuts to their capital spending plans. The largest share — $33.9 million — would come from Montgomery County Public Schools.
ecunningham@gazette.net