Baltimore, like most major American cities, is still feeling the effects of the Great Recession. Lower revenues and rising costs have created $186 million in cumulative budget deficits over two fiscal years, which is equal to a 56 cent increase in the property tax rate.

This year, I started the budget process first by cutting my office budget. The Mayor's Office budget has been reduced by 19.6% since I took office. The budget plan cuts central administrative costs across all city agencies to 10% below current service levels and freezes pay for city managers.

Cities across the country, including Baltimore, are getting hit hard by slower revenue growth, significant cuts in state aid, and increasing costs in pensions and healthcare. In many cities, these factors are causing devastating cuts to core functions like public safety and public schools. Los Angeles has stopped hiring new police officers. Newark and Camden were forced to layoff hundreds of police officers and firefighters. New York City is now bracing for teacher layoffs. Some mayors are being forced to consider property tax or other tax increases.

Baltimore's Fiscal 2012 preliminary budget bucks national trends in American cities by taking further steps toward fixing structural budget deficits while still fully funding the city's obligation to public schools, continuing an aggressive plan to hire hundreds of new police officers, providing funding for neighborhood street repair and blight elimination, and maintaining mission-critical city services that our neighborhoods rely on-all without raising any taxes, including property taxes.

This preliminary budget protects core priorities like public education, public safety, and essential services without raising any taxes. In this budget, the priories are clear: Better Schools. Safer Streets. Stronger Neighborhoods. Growing Economy. A Cleaner, Heather City and Innovative government.

• We are fully funding our obligation to public schools to improve academic achievement in the classroom.
• We are fully funding the police department and hiring 300 new police officers in 2011 to fill vacant positions and keep crime going down.
• We are funding my new Vacants to Value initiative to reduce vacant homes and blight and strengthen our neighborhoods.
• We are maintaining our City run career centers to help city residents get prepared and trained for employment, and we are investing in technology start-up centers to help create the jobs of the future.
• We are investing in innovative programs that improve city services while cutting costs.
• We are maintaining neighborhood trash collection and street sweeping to keep our neighborhoods clean.

The budget reduces employee healthcare spending, which is a significant cost-driver of the deficit, through improved benefits management. We outlined these changes, which will save $5 million this year and $10 million next year, in a press conference earlier this month. The healthcare changes alone will prevent nearly 100 layoffs.

Mayor Rawlings-Blake announces stepUP! Baltimore, and initiative to leverage volunteer service.

There are gaps in this budget that need to be filled by new and innovative ideas. Today, I announced details about Baltimore's first comprehensive volunteer plan: stepUP! Baltimore. The initiative will leverage volunteer service as a strategy to address the most pressing challenges in Baltimore's communities, including drug addiction, vacant lots, and youth violence. With stepUp! Baltimore, I want to encourage more citizens to engage and make Baltimore stronger.

This is a tough budget with no new taxes. But it is also a smart budget plan, because we are investing our resources into clear priorities to achieve the results we want for Baltimore.