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Montgomery County committee recommends keeping spending affordability guideline at $300 million
Summary
Committee staff recommended the council maintain the countyspending affordability guideline at $300 million per year after analysis showed modest worsening in debt indicators; the committee voted unanimously to recommend the staff position to the full council.
Montgomery CountyGO Committee members voted unanimously to recommend that the full county council keep the Spending Affordability Guideline (SAG) at $300,000,000 per year, following staff analysis that showed a modest deterioration in several debt-capacity indicators.
The committeechair said the purpose of the February review is to ‘‘set and review the spending affordability guidelines’’ and stressed the guidelines reflect affordability rather than community need. Staff recommended affirming the October guideline and advised against increasing the SAG now because recent updates to key assumptions (including lower projected personal income and a slightly smaller assessable property tax base) have pushed some indicators in a negative direction.
Why it matters: The SAG limits how much general obligation (GO) bond borrowing the county will authorize in order to protect operating-budget flexibility and maintain long-term creditworthiness. Staff and council members said steep increases in GO borrowing would increase debt-service expenditures…
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