In a letter to his budget chief regarding cities and towns across Connecticut, Governor Dannel Malloy provided a warning of sorts that it could be their turn when it comes to facing budget cuts.
He wrote, “if we fail to recalibrate aid based on shifting local demographics, economies, and need, we risk perpetuating an inequitable distribution of burden among our communities.”
Gov. Malloy had his Office of Policy and Management conduct a similar exercise earlier in the year during his push to shift hundreds of millions in teacher pension obligations on to cities and towns while sending more municipal aid to struggling cities like Hartford, New Britain, and Waterbury.
Both Republican and Democrat leaders in the General Assembly say they want to ensure there are minimal changes to how much cities and towns have received in previous years.
Speaker of the House Joe Aresimowicz said in a statement, “There is bipartisan consensus among Democrats and Republicans in the legislature to mitigate cuts to municipal aid that the governor originally proposed, and is now further looking at.”
He added, “when a budget is finalized I believe we will not see these cuts at the level of the governor’s plan.”
Sen. Len Fasano, the top Republican in the Connecticut Senate agreed with Aresimowicz, writing, “If a municipality has shown fiscal responsibility and been successful in making tough decisions to achieve a positive financial outlook that town or city should not be penalized simply for their smart budgeting. Perhaps Gov. Malloy should have learned from these municipalities when he crafted budgets for our state.”
He went on to say it is “illogical” to put policies in place that discourage towns from being fiscally responsible.
The governor’s proposal to shift $400 million in responsibilities for teacher pensions was dead on arrival in both the House and Senate during the 2017 Regular Session, which only added to the gridlock on how to proceed with a state budget.
He argues that since cities and towns negotiate benefits and wages independent of the state, and then ask the state to cover significant portions of their expenses, he said it was only fair that municipalities start to pay a portion of their pension obligations.
Cities and towns were outraged at the plan, arguing it could lead to historic property tax increases just to cover the costs, while Malloy countered with some fiscal report cards, showing how some of the wealthiest cities and towns in Connecticut could handle such burdens.
Malloy concluded his letter to OPM Secretary Ben Barnes by writing, “We risk not investing in the communities that should be our assets in attracting economic development, young professionals, and families.”
Connecticut’s fiscal year ended on June 30 without a state budget and is currently operating without one.