The mayor’s budget gurus are fast becoming part of her administration, with the Board of Estimates set tomorrow to approve a new extension to their contract – and another $490,000 in city funds.

The Philadelphia-based PFM Group was hired in 2011 to help the Rawlings-Blake administration fashion a 10-year savings plan largely through reductions in employee benefits, with long-term changes slated in the delivery of city services.

The original $460,942 contract ballooned to $1 million when the city extended the agreement last year so the consultants could work with the Department of Finance to make structural changes in firefighter work hours, changes in the retirement system, extension of the parking tax and the institution of a billboard tax.

Coupled with these changes was a modest reduction in the city’s property-tax rate for homeowners and a 2% salary increase for employees.

Big Savings from Recommendations

Tomorrow the mayor will seek to extend the contract to September 2015, making a total of $1,499,672 awarded to PFM since it was hired.

Following criticism of last year’s extension, the administration has justified its latest agreement with estimates of the money to be saved through the consultant’s help in guiding the city through complex financial matters.

According to the administration, the changes recommended by PFM have resulted in $395 million in projected savings through fiscal 2022. By extending its contract, the city will “acquire services” from PFM that “will help implement future initiatives and save an additional $202 million, if all initiatives are implemented as planned.”

One initiative is expected to be completed by the end of this month – a $44,200 contract with Life Cycle Corp. to document evidence of “any abuse” of the Family Medical Leave benefit by city employees. The contract was passed unanimously by the Board of Estimates on May 28 over a protest by the City Union of Baltimore, Local 800.

Another initiative is to establish new eligibility, contribution and benefit provisions for fire and police officers covered by the Fire and Police Employees’ Retirement System. Those changes were introduced at last night’s City Council meeting and will be aired at a future hearing of the Taxation, Finance and Economic Development Committee.

Making Garbage Collection Self-Sustaining

In the future, the 10-year plan seeks to automate trash collection by retrofitting garbage trucks with collection arms and to place the trash system into a self-sustaining “enterprise” unit that would assess user fees, much like water and sewer fees to homeowners, rather than having trash services come out of general revenues.

The fiscal 2015 budget passed by the Board of Estimates and City Council has lowered the property-tax rate from $2.25 to $2.13 per $100 of assessed value for homeowners. The rate for businesses and existing rental properties will remain at $2.25.

At the same time, water and sewer bills are set to rise 11% on July 1 at the start of fiscal 2015.