Forget It Jake, It's Baltimore

 From the Balmer Sun, Baltimore budget deficit swells to $64M. Here’s why.

Baltimore officials say an unusually brutal winter and soaring overtime costs have pushed the city’s current budget into a $64.4 million deficit, forcing leaders to tap reserve funds despite stronger-than-expected tax revenue. Finance officials told the Baltimore City Council on Tuesday that cleanup costs tied to four snowstorms — along with overtime spending in the police and fire departments — wiped out what had been projected as a $19.6 million surplus earlier this fiscal year. The largest hit came from emergency winter operations that kept crews working around the clock for weeks. The city budgeted $8 million for snow cleanup and instead spent $80 million this year.

“Even in the best planned environment, you’re going to hit a storm that’s going to go beyond what you’re budgeted for,” Deputy Finance Director Bob Cenamme told council members. “That’s why we have reserves.”

Baltimore wasn’t the only city struggling with this year’s winter storms. Philadelphia, for example, budgeted $4.1 million for snow cleanup and ended up spending $59 million. Washington D.C., meanwhile, budgeted $7.3 million and spent more than $67 million.

To close the gap, Baltimore plans to draw from its rainy-day fund and use FEMA reimbursement money. The city’s reserve fund now sits near $200 million.  City officials confirmed to The Baltimore Sun they haven’t received the FEMA funds yet. As of Tuesday, Baltimore was still in the process of applying for the money.

Tax revenue, parking revenue and investments saved the city from digging an even deeper hole in its budget, city officials said. Income tax revenue alone gave the city $17.3 million more in revenue surplus than originally projected after generating $74 million more than predicted in Q2. Vacancies across several agencies, including the comptroller’s office, state’s attorney’s office and city IT department, also reduced spending.

Still, the city’s overall financial outlook deteriorated sharply from earlier projections. The Q2 projections for the total budget were worse by $84 million, as the city expected to have a $19.6 million surplus instead of a $64.4 million overall deficit.

Here's a clue. If you spend more money than you take in, you'll run a deficit.