County Letter Hints At Grants Cut
OCEAN CITY •€' The last time the Ocean City Mayor and City Council received a bit of correspondence from the County Commissioners concerning annual grant money, they were eventually cut 9.5 percent of the prior year's funding. This time around, the town is hoping to merely hold the line.
At the end of Tuesday's work session, Mayor Rick Meehan showed the council a letter from County Commission President Bud Church, which in Meehan's words, 'laid the groundwork for the fact that there would more than likely be no increases this year.'
In his letter, Church wrote, 'I'm sure you are aware that property assessments have declined, which will result in substantial revenue reductions in addition to the decline of real property taxes. •€¦ we are also experiencing a severe decline in income tax revenues as a result of the economic downturn and as a result, significant reductions will be required in all areas of government operations and the elimination of funding for non-essential services must be considered in order for the county commissioners to develop a balanced budget.'
In 2008, Ocean City received $2.26 million in grants from the county, but shortly thereafter, the town hired a consultant to conduct a study on tax differential, which provides relief for city taxpayers for services the town provides outside of the resort, and found the number should be approximately $13 million.
'In 2009, we pursued tax differential, and although we didn't get close to what the study called for, the county did increase our grant funding substantially to $4.26 million, and that showed that they acknowledged tax differential and were willing to work with us,' said Meehan.
Last year, the commissioners asked all departments to trim at least 3 percent from their requests, and Ocean City complied and asked for $4.17 million in grants (spread out over nine categories) as opposed to the $4.26 million the prior year.
In reality, the commissioners cut local municipalities by 9.5 percent, which shrunk the resort's grant funding from the county to $3.85 million.
Meehan asked the council's permission to pen a letter to Church asking that the town receive the same amount as it did last year.
'If you look at the total reduction of revenue over the past two years, it shows that Ocean City has received $800,000 less and that is substantial,' said Meehan, 'I think that holding the line is realistic and I think that our request is responsible. We don't want to take two steps back and that is why we are going to request that we, at the very least, hold our ground.'