Councilmembers press for clearer rules on when reserves can be used, warn against masking structural deficits

Committee members broadly thanked Davenport for the reserve study but pressed for precise policy language about when each reserve could be used and for stronger linkages to overall fiscal structure. Councilmember Friedson warned the county cannot rely on reserves to mask recurring structural deficits: "None of this really matters if we use it as a cushion and as an excuse to have structural deficits year in and year out," he said.

Councilmember Katz urged keeping the combined 10% core reserve sacrosanct and asked whether the proposed capital and risk-mitigation reserves would be treated as equally off-limits; Davenport replied that the 10% should remain protected while the additional reserves could be more fungible for specified one-time uses or rainy-day scenarios. Nancy Feldman of the Department of Finance clarified that the Revenue Stabilization Fund may be used only for unfunded appropriations to cover budget shortfalls after council passage and that undesignated reserves are available for supplementals and special appropriations with council approval.

Members asked for more explicit definitions and a homeowner-friendly process for any exemption rules tied to other bills discussed later in the meeting. The committee requested the county executive's reaction to the consultant recommendations before the end of August and agreed to revisit the reserve policy in the fall alongside budget deliberations.