Operating vs. Capital Budgets

The City of Baltimore's budget is divided into two separate budgets: 

  • Operating Budget, managed by the Department of Finance, funds programs, services, staff, and supplies. 
  • Capital Budget, managed by the Department of Planning, funds physical infrastructure projects such as building new community centers, roads, and water system infrastructure. Learn more about the capital budget through DOP. 

 

Two swimmers hanging on the edge of a pool with swim caps, googles, and kickboards. A staff member sitting at the edge of the pool talking with them.
Picture of Rita Church recreation center, in the image you can see the side of the building and a pool behind a fence.
Operating funds are for the staff and equipment for the pool.
Capital funds are to build the pool and recreation center.
City Revenue Sources 

The operating budget has three main sources of funding, General Funds, Grant Funds, and Enterprise Funds. More details on the City's revenue sources can be found in the Preliminary Budget and Executive Summary budget publications.

General Funds are the City's largest source of funding, representing approximately 65% of annual operating revenue. Revenue sources for the General Fund include local taxes paid by residents, businesses, and visitors. Specific taxes include property tax, income tax, recordation and transfer tax, and hotel and parking taxes. The General Fund also includes certain direct aid from the State based on funding formulas defined by the legislature and other sources of funds managed by the State. Local policy makers have the most flexibility over how these funds are spent.

Grant Funds are received from the federal and State governments, as well as private grantors. These funds represent approximately 17% to 18% of annual operating revenue. Grant Funds are legally required to support specific programs and initiatives and cannot be used for other purpose.

Enterprise Funds, which represent approximately 18% of the City's operating revenue, are collected through user charges for City services. Water, wastewater, and stormwater fees are examples of user charges that get projected as Enterprise Funds within the budget. Enterprise Funds are self-sustaining, meaning that fees received from users go directly back into supporting service delivery.

City Expenditures

Baltimore City began the process of Outcome Budgeting with the Fiscal 2011 budget. This process focuses on funding programs and services that deliver the best results for City Priority Outcomes defined by the Mayor. Throughout the years the specific steps of the process have changed, but the City continues to focus on how the work of agencies will drive change in Priority Outcome areas. The current Priority Outcomes for the City are Prioritizing Our Youth, Building Public Safety, Clean and Healthy Communities, Equitable Neighborhood Development, and Responsible Stewardship of City Resources. More information about Outcome Budgeting and funding by Priority Outcome and agency can be found in the budget publications.