County Executive Bob Culver is proposing a fiscal 2016 budget of $129,000,243, increasing spending by just $266,000 over what was approved for the current year.

Culver’s budget, which was submitted to the County Council last week, keeps the county’s property tax rate flat at $0.9516 per $100 of assessed property value.

Culver’s first budget as county executive relies on spending cuts within the departments, a increase in income tax collections due to growth and a slight increase in the county’s more than $5.635 billion assessable tax base.

“I am not proposing any increases in real and personal property tax rates,” said Culver in his budget message. “The budget is designed to foster a more business friendly environment in Wicomico County and to recognize the challenges our citizens are coping with as the result of the deep recession we have experienced.”

Culver made clear, too, that the county continues to encounter a challenging financial environment.

“I am committed to providing a high quality level of services to our citizens,” he wrote. “However, our ability to refresh infrastructure and address deferred maintenance continues to be very limited.

“I remain concerned about the fragile nature of our local economy as well as the continuing fiscal challenges faced by the state of Maryland; challenges that will continue to have impacts on our local finances.”

The county’s contribution to the school board, under Culver’s plan, would be $41.3 million, about $519,680 more than last year’s appropriation. State-mandated maintenance of effort funding required a minimum increase of nearly $400,000.

Culver and his financial advisers have estimated recurring revenue of $122,815,651 will cover our debt service, recurring educational, public safety, pension, health care, general government, culture and recreation, and community development ongoing expenses.

Culver is proposing the use of $6.18 million of General Fund prior year revenue to pay for one-time operating costs, Capital Improvement Plan funding and minor capital/infrastructure spending.

The increase, according to Culver, accommodates a $910,527 recurring expenditure for the Board of Education as a result of state-mandated increases in Maintenance of Effort and teacher pension funding. It also accommodates $222,288 to fund the county’s commitment to the Fraternal Order of Police in accordance with the collective bargaining agreement forged in February.

One of Culver’s first acts as executive was to call on department heads to draft 2.5 percent spending cuts. Culver, in his budget statement, reports that his departments exceeded his target and have submitted reductions amounting to 6.4 percent.

The budget shows that each penny on the real property tax rate equals approximately $567,436 in real property tax revenue. Meanwhile, each 1-cent change in the personal property tax rate equals approximately $37,647 in personal property tax revenue.

The shows the real property assessable base increased slightly -- 0.04 percent -- from $5,632,599,187 in FY15 to $5,635,225,049 in FY16.

With the increase in property assessment values along with the increase in new construction, the county was able to keep the real property tax rate for FY16 constant with FY15 real property tax rate.

The proposed FY16 tax rate of $0.9516/$100 of assessed value will generate $198,472 more revenue from real property than in FY15.

Culver’s budget submission is just the first step in a long review process that will end when a budget is enacted July 1.

The County Council is required to set dates for two public hearings as part of the budget process.The first will be for the budget itself, at which any taxpayer or their representatives shall be entitled to be heard. The Charter states that a public hearing is to be held by May 15, but the council may, by resolution, set another date for the budget hearing.

The second hearing is required by state law regarding the constant yield tax rate, which is the number that would generate the same amount of real property tax revenue from one year to the next; as the assessable base increases, the tax rate must go down.

Conversely, as the assessable base goes down, the tax rate should increase to generate the same revenue. When a County chooses to set a rate higher than the constant yield tax rate, which may or may not be less than the previous year’s actual tax rate, a hearing is required to explain the difference.

The County Council has until June 1 to adopt a budget.