Annapolis finance committee approves report, votes to probe county sewer charges and to recommend harbor master be moved in mayor’s budget

Annapolis — The Finance Standing Committee convened May 9 and approved its FY26 committee report after line-by-line edits, and it voted to add two formal recommendations: (1) to investigate a roughly 33% increase passed along by Anne Arundel County for the city's sewer contract and (2) to recommend the relocation of the harbor master position as reflected in the mayor's proposed budget.

Committee members said the report compiles department presentations and flag important budget cautions, including projected increases in debt service and changes to capital-project funding sources. The committee voted to transmit the report and its recommendations to the full City Council for consideration.

Why it matters: The report combines near-term budget recommendations, department performance notes and cautions about longer-term debt-service pressures that could affect future budgets. The added recommendation to probe county sewer charges addresses a direct cost passed to city ratepayers; the harbor master recommendation touches a pending code change that the committee said should be debated by the full council.

Committee action and key outcomes

- Investigate Anne Arundel County sewer charges: The committee added a recommendation to investigate the additional cost passed to the city by Anne Arundel County for the sewer (Stewart) contract, citing a reported 33% increase tied in part to large county capital projects. Director Moran told the committee, "The 25% was calculated based on total debt service," when members questioned growth assumptions in related debt-service modeling. The motion to add the investigation recommendation passed on a voice vote.

- Harbor master placement: Committee members debated whether the harbor master should be moved in accordance with the mayor's proposed budget. Some members said code changes should precede budget changes; others supported reflecting the mayor's proposed placement in the committee's recommendation. The committee voted to recommend that the harbor master be moved as shown in the mayor's proposed budget; the committee recorded ayes and a single nay and will forward this recommendation to the full council. Committee members noted an ordinance on the subject had been pulled from Monday's city-council agenda.

- Approval of the committee report: After edits and clarifying language on formulas, charts and project thresholds, the committee approved the finance report and instructed staff to fold the committee's recommendations into the version sent to the council.

What the report highlights

- Debt service and debt-capacity analysis: Committee members said the report shows debt service remaining below policy targets in FY26 and FY27, but cautioned that debt-service costs are projected to rise: the committee heard estimates showing debt-service totals rising from about $8.78 million in FY26 to roughly $11.0 million in FY27 (a roughly 25% increase). The presentation also noted conservative revenue and expenditure assumptions and that a projected debt-service share of expenditures could approach the committee's policy midpoint (roughly 11%) under conservative assumptions.

- Capital projects and funding sources: The draft report was edited to clarify that project funding charts reflect funding in a single fiscal year (FY26) rather than lifetime funding for each project. Committee members discussed a shorter list of new FY26 additions (about $4.5 million) compared with roughly $20 million of additions reported the prior year; members also clarified that the list of projects labeled as having "significant changes" was compiled from items with funding or scope changes of $500,000 or more.

- Enterprise funds and utilities: The committee called out two large water/sewer projects referenced in department presentations (Eastport Phase 2 waterline replacement and Southgate water and sewer replacements) and questioned a reported 33% increase in the county-run sewer contract passed to the city. The committee added a recommendation to investigate the increases and the allocation method the county used; staff recommended the item be phrased as an investigation of the additional cost passed by Anne Arundel County for the Stewart contract before pursuing negotiations.

- Departmental recommendations and staffing: The report incorporates department-level changes and recommendations captured in presentations: examples include restoring a mechanical inspector in Planning & Zoning, adding an IT position for Fire (or at minimum studying the cost of a dedicated IT staffer), renaming positions (for example, creating a small-business liaison), and program-level funding notes for recreation, transit and community grants. Committee members also asked staff to make editorial fixes (formula placement and sentence parallelism) and to add clarifying caveats on charts.

Minor but material clarifications requested

- Clarify formula placement and add a short explanatory label for how the budget-stabilization formula is calculated (the report now states the projected balance and the calculation g = h + i + j). The committee also adjusted wording to describe projects with "significant changes in funding or scope" rather than only "increases."

- Capital funding charts: the committee added a caveat line saying charts reflect funding sources for FY26 only, not total project financing across a project's life.

Votes at a glance

- Motion to add recommendation to investigate additional charges from Anne Arundel County for the sewer (Stewart) contract: Passed (voice vote; recorded as favorable). (Action recorded in committee recommendations.)

- Motion to recommend moving the harbor master position as reflected in the mayor's proposed budget (placement referenced by members as "Brecken Park" in the budget language) from its prior administrative location to the city manager's office per the mayor's proposal: Passed (voice vote; ayes and one recorded nay). Committee members noted an ordinance tied to the change was withdrawn from the immediate council agenda and that the council will consider the underlying code change.

- Motion to approve the Finance Standing Committee report for transmittal to the City Council: Passed (voice vote; recorded as favorable).

Discussion vs. decisions

Committee discussion produced edits and clarifications that staff incorporated into the report; formal decisions were limited to the three votes above. Several recommendations (for example, to renegotiate or to add staff) were framed as follow-up tasks or investigations rather than immediate contractual changes.

What happens next

The committee's edited report and its recorded recommendations will be forwarded to the full Annapolis City Council. The committee asked staff to ensure the report language accurately reflects the committee's edits and to include clarifying caveats about charts, formulas and project-threshold definitions. The council will consider the committee's recommendations, the pending ordinance on harbor-master placement (which was removed from the near-term agenda), and any follow-up information returned on the county sewer charge investigation.

Sources and reporting provenance

This article summarizes the Finance Standing Committee meeting discussion and votes recorded on May 9, 2025. Key statements and the vote actions appear in the committee transcript and department presentations used to prepare the FY26 finance report.