That big budget surplus projected for last year has dwindled to pretty much a nothingburger due to late-reporting agency overspending.

Widespread employee overtime and unanticipated contractual services consumed the $50-million-plus “windfall” that was reported last October for fiscal 2024, according to Budget Director Laura Larsen.

In recent weeks, the City Council’s budget committee has been advised by Larsen of unanticipated costs coming out of the year-end balances of multiple city agencies, squeezing and then eliminating the prior surplus.

Tonight the Council balanced the city’s 2024 budget – as required by law – by appropriating $56,516,660 in surplus revenues ($2 million more than expected last October) to offset the agency deficits, then transferred $11,346,666 more in unspent funds across agencies.

By far the biggest budget buster was the $33.4 million needed by the Fire Department.

The agency blamed “overtime due to sworn vacancies and unbudgeted EMS contractual services” for the cost overruns. That amount included $245,428 in overtime to a single employee, David Lunsford, a paramedic emergency medical technician who – between overtime and his regular salary – was the highest-paid city employee at $358,586 last year.

While the Fire Department was fully 10% over its $333 million budget, three other agencies had higher percentage deficits.

Leading the list was the sheriff’s office, which was 16% over its $27 million budget.

Half of that deficit arose from a controversial decision by Sheriff Sam Cogen to increase deputy pay by triggering a code in the city’s online payroll system that resulted in a $2.2 million overpayment to 94 deputy sheriffs.

Inspector General Isabel Mercedes Cumming last month questioned whether Cogen’s order to increase deputy pay without the authorization of Mayor Brandon Scott or human resources was legal.

Cogen defended his decision as essential to recruit and retain personnel. So far, the city has not tried to claw back to erroneously issued funds.

Among the top overspenders: the fire department, sheriff’s office, finance, and recreation and parks.

Recreation and Parks overspent by 10.3% ($7 million) on “contractual services and overtime in urban forestry and park maintenance,” according to documents sent to the City Council, while the Finance Department was 10.5% over budget ($4.3 million) mainly due to consultants hired to operate its payroll system.

Other agencies that overspent their budgets include Health ($5.3 million), Public Works ($6 million), Police ($3.3 million), Law ($1.5 million), Transportation ($1 million), and the Board of Elections ($1.4 million).

Perhaps the biggest surprise was the police department, whose overtime expenses under Commissioner Richard Worley are considerably below the highs of a decade ago.

Property Taxes on the Rise

The city was able to pay for these expenditures from revenue sources that brought in more money than expected.

Baltimore’s share of state income taxes, for example, was $19.4 million over initial estimates, and property tax receipts came in $14 million higher, despite the overall tax base declining by some $250 million through tax appeals and the shrinking tax base of downtown Baltimore.

Highway user funds ran $9.5 million above projections, while investment earnings jumped up by $1.6 million due to higher interest rates and a rising stock market.

Also benefiting the administration were unspent funds by General Services and several other agencies, which were reallocated to departments in the red.

Mayor Scott and Comptroller Bill Henry earlier approved the added agency expenditures through Board of Estimates actions.

The City Council tonight affirmed the reallocations in a unanimous vote.