State Offers to Pay Off Hartford's Debt

The state has offered to pay off Hartford's millions of dollars of debt under the new budget deal. 

Hartford Mayor Luke Bronin said he is presenting the framework to city council members, who would need to approve the deal, on Thursday night. The mayor wants the deal signed by the city's next debt payment deadline on April 1. 

Lawmakers from both parties signed off on the state providing assistance to the Capitol city in the state budget that was approved October 2017. The mayor has been working with the governor's administration on the details of what that bailout looks like. 

Under this framework, the state would pay the city's $550 million in debt over the next two decades. If the deal is approved by April 1, the state will pay the city's $12 million debt payment. The state may give the city an additional $24 million to close Hartford's budget deficit.

While the state would pick up the annual debt payments, Hartford would still be required to pay $5 million annually for Dunkin' Donuts until 2021. 

The state is looking to refinance Hartford's debt by stretching the city's debt payments farther apart in order to reduce annual contributions. 

In exchange for the extra funds, Hartford was placed under state oversight in January.

That oversight board will review budgets, contracts and labor agreements. Hartford also can't issue new bonds without the group's permission.

“Over the past two years, we’ve made deep reductions in spending, negotiated dramatic savings with labor, and partnered with our biggest employers, and this agreement with the state is the last step to put the city on a more sustainable path,” Bronin said. “We’ve faced Hartford’s fiscal crisis honestly and directly, and I’m proud that we worked to build a new partnership that works instead of just faking it or kicking the can. Without this kind of partnership, our capital city is bound to struggle if not to fail, because it just doesn’t work to have a city with half its property tax-exempt — a city built on the tax base of a suburb. Even with this agreement, the city’s budgets will remain very tough and very tight for years to come.”

The city council will vote on the deal this Monday. City council members NBC Connecticut spoke to on Thursday said it's a done deal.