ELKTON — Correcting a long-unnoticed error in the state tax data in new property developments, the Cecil County Council cast an unanimous vote to allocate an additional $232,338 to the nine volunteer fire companies.
The council voted 5-0 to move the money, because it has become clear that fire companies were missing out on at least four fiscal years of additional funding. The money will be taken from the county’s budget stabilization fund, which is designated for “unexpected fluctuations in revenues and expenditures.”
For county Budget Manager Rebecca Anderson, this is exactly the situation that the relatively new fund balance policy was intended to address. County Executive Alan McCarthy announced in March that he was creating a second reserve to handle unpredicted costs throughout the year.
“The reason the county follows a conservative fund balance policy is so when things that were not planned in the current budget take place, the county can address and pay without any additional ramifications,” Anderson told the Whig. “Taxes are not going up based on the [state’s] mistake.”
Part of the county’s complicated funding formula for fire companies is 2 cents per $100 of assessed property value. Each property is assigned a fire district code, which assigns a fire company to respond to calls for service, in the Maryland Department of Assessment and Taxation (SDAT) internal system.
The implication to this assessment is that with more development and property improvements, fire companies should see a raise in their county funding. But because the fire code of new properties for years was not put in SDAT’s internal system, the nine fire companies missed out on an unknown amount of dollars.
Of the nine fire companies, Charlestown Fire Company lost out the most at $116,088.39 over the past four fiscal years. Property values rose in that fire district mostly due to the booming development at Principio Business Park in the past three years, Anderson told the Whig.
After Anderson notified the state, SDAT developed a programming script that could only trace back to Fiscal Year 2016.
To ensure that the mistake doesn’t happen again, the county Land Use and Development Division will require the fire district code to be placed on the subdivision plat, so it’s clearly known which fire company would be assigned to a property.
SDAT can run the script again to make sure no property is missed in future budgets. Fire Company chiefs also receive a new email when a new property goes online in their districts, so they can also double-check property records.
Even with this mistake corrected, it’s still difficult to say exactly how much additional funds the fire companies will see in FY2021 and beyond because the amount is tied directly to property values.
“It’s hard to determine how fast the growth will take place,” Anderson said. “If we were to enter into a recession, the allocation always has the potential to go in the opposite direction. [But] the budgeted amount is set in code, it’s not funded at a level the county executive or the council deems appropriate.”