Hartford’s budget fallout slams Fairfield
FAIRFIELD — First Selectman Mike Tetreau has to get a budget proposal readied for March 1. For the last two months, his department heads, he said, had been bringing in budgets that were at, or below, current levels. So far, so good.
And then, Tetreau said, the town was hit with what he called the “equivalent of a financial Superstorm Sandy” — also known as the governor’s state budget proposal. And that proposal means, at this point, trying to find another $14 million to cover both cuts in state revenue and a new requirement that calls for Fairfield to contribute $9 million to the state-managed teacher pension fund.
Tetreau said they expected cuts from the state. “I didn’t expect it to be this bad.”
While Gov. Dannel Malloy’s proposal is sure to be changed as it moves through the approval process, the town has to work with the most recent information it has, Tetreau said. As the state budget changes, the town can make adjustments for any changes prior to the municipal budget approval at the end of April. But, the state won’t finalize its budget until after the town’s spending plan has been adopted.
There are “all sorts of questions” about the teacher retirement payment, Tetreau said. “They’re asking for payment by Dec. 31,” he said. “This, to me, is the worst of all possible solutions. Instead of having an $18.4 billion budget, the governor shaved off $400 million and sent it off to the towns. There’s no cost reduction.”
It’s like going out to a restaurant, Tetreau said and being made to pay for someone else’s meal.
What the town would get under the governor’s proposal (with reduction in parantheses):
State municipal aid/grants to town:
ECS grant $0 ($3,583,484)
Public school transportation $0 ($6,636)
Pequot-Mohegan grant $276,419 ($1,998)
PILOT: Colleges and hospitals $1,519,387 ($493,629)
PILOT: State owned property $23,099 (increase of $22,961)
Municipal Revenue Sharing bonus pool - town aid roads $0 ($96,747)
Municipal Revenue Sharing bonus pool - sales tax $1,144,842
LoCIP $683,932 (increase of $310,878)
Town Aid road $714,539 (increase of $2,072)
State municipal aid/grants to Board of Education:
Special Education Excess Cost provision (replaced with new special education grant) $2,140,179 ($1,217,317)
Adult Education $1,572 ($80)
What the town would be expected to pay under the governor’s proposal:
Teacher’s Retirement Contribution $9,184,608
Despite assurances that this $14 million won’t be the final figure, Tetreau said that is what he has to work with right now, which means looking at a combination of service cuts, a tax increase, and possibly an infusion of some cash from the town’s surplus.
What the governor is proposing, Tetreau said, could lead to towns having to impose an 8 or 9 percent tax increase, something he vowed would not happen in Fairfield.
“From a personal standpoint, I will fight the state every step of the way to make sure this doesn’t happen to Fairfield,” Tetreau said. His reality, though, he said, is he has to “work with the latest, available information.”
“We have contractual obligations, as far as wages, medical benefits, pensions,” he said. “Debt service is another number we have to fund.”
While the first selectman said he views layoffs as an absolute last resort, he cautions that the state budget likely would mean significant cuts in services provided by the town’s larger departments.
“You aren’t going to get much savings from the smaller departments,” Tetreau said. “Cuts to the library are a very real possibility, cuts to Parks & Rec are a very real possibility, cuts to Public Works are a very real possibility. It’s got to substantive cuts. That’s what we’re looking at.”
Cuts could come in the form of reduced operating hours at the libraries and reductions in the Public Works paving program.
The Board of Education’s $168 million budget could also fall victim to the budget ax, he said, though it would be up to the school board to decide where those cuts would fall.
As for using surplus funds “That would be one of the last places we’d look, but it is the reason you have a surplus, for when you’re faced with a fiscal situation of this magnitude,” Tetreau said.
The first selectman is also angered by comments made at a Tuesday Connecticut Conference of Municipalities meeting by Benjamin Barnes, of the state’s Office of Policy and Management. “He said towns should raise taxes, especially those towns will mill rates in the 20’s or less,” Tetreau said. “What I find appalling is the governor recommending we raise our property taxes ... raising property taxes is a regressive tax that hurts senior citizens and people with lower incomes that own property and small businesses.”
There would be “nothing worse for the economy in Connecticut than raising property taxes,” he said.
Tetreau will continue to meet with department heads over the next two week to find areas to cut what he says is already a very lean budget.
The Board of Selectmen and Board of Finance begin joint budgets hearings on March 1, and Tom Flynn, finance board chairman, has asked the state delegation — state Sen. Tony Hwang, and state Reps Brenda Kupchick, Cristin McCarthy Vahey, and Laura Devlin — to attend either that meeting or the next, on March 2.
Flynn wants them to address “the state budget crisis and its potential impact on Fairfield.”
Board of Finance Chairman Tom Flynn has asked me to contact you and let you know that he is inviting you to come before the Board of Finance and Board of Selectmen at an upcoming joint budget hearing to address the state budget crisis and its potential impact on Fairfield.
The delegation would be given about 45 minutes to speak and take comments or questions from board members.
In recent remarks to the finance board, Flynn noted that by working with the selectmen, the Representative Town Meeting, the Board of Education and department heads, they have done what is in the best financial interest of the town and the taxpayers, leaving the town with a strengthened financial position.
“As we plan for this next fiscal year, however, we face a new and growing threat in the form of a significant loss of revenue,” Flynn said, not only from state revenue but also the sale of the General Electric property to Sacred Heart University. “If the revenue losses were just passed on to our taxpayers to replace, it could mean a tax increase of between 1.25 percent and 1.75 percent before accounting for any spending increases.”
Flynn said in years past, the state has “taken the easy road” and underfunded long-term obligations, bonded significant sums of money and “kicked the fiscal can down the road, as opposed to making the tough decisions that financial hardships require.”
“We should not and cannot do the same,” Flynn said, adding town residents already contribute over $260 million to the state and gets back under $8 million in direct annual revenue.