By dialing back anticipated state aid and slightly increasing revenue received from tax dollars, the Board of Finance (BOF) voted on May 23 to set Branford's new mill rate at 27.41 for the 2016-17 fiscal year , creating a tax increase of just under two percent.

The BOF's action followed the Representative Town Meeting's (RTM) vote in May to cut just over $292,000 from requested 2016-17 town budget expenses (see the story here ).

The BOF made the mill rate decision to help put Branford in a better position against further decreases in estimated state aid that could hit at any point during the next two years, should the state spending growth outpace revenues.   This year, the town experienced just such a decrease in aid when the state pulled back a promised $170,000 in response to rising expenses at the state level.

The new mill rate will reflected in property tax bills going out to property owners with the start of the new fiscal year (July 1, 2016).

At the start of the budget process in January, First Selectman James B. Cosgrove set a goal of no more than a two percent increase in taxes and the BOF put forward a budget with a recommended 1.8 percent tax increase to the Representative Town Meeting (RTM) in March. However,  Following Governor Dannel P. Malloy's cuts to the proposed state budget in April, Cosgrove and Branford Finance Director James Finch headed up a fiscally conservative effort to work with both the RTM and BOF to further adjust Branford's budget before the mill rate would be set.

Knowing "...the state has to collect the money before they can actually give it to us," and that there is "...still a large projected shortfall for Fiscal Year 2018," Finch said the town's strategy was "to try to amortize it over a couple of years."

The RTM's budget role allows it to reduce budget expenses; but not increase revenues. The BOF's role allows it to increase budget revenues.

By the time RTM-approved budget reached the BOF to set the mill rate May 23, estimated biennial state aid numbers for Branford totaling $3,012,106 had been finalized. But there were reasons to remain cautious that those numbers may not stick, Finch told the BOF.

"We're not confident that that's ever going to happen. It's not the fault of any individual or individuals -- we think it's best intention of the Governor and the State Representatives to hold municipalities harmless; but we don't think the fiscal environment allows that to happen. And I think we'd be naïve (not) to think that something's going to hit us in the next year, or more likely in 2018."

Together with Cosgrove, Finch recommended the town proceed with an expectation of receiving $2,754,078. Adjustments at the town level would create "cushion" of $574,000; Finch explained.

"The approach we've taken is to make some adjustments downward from where state is actually looking," said Finch, stressing  Branford was  "not alone" in thinking about taking a "conservative and cautious approach."

"We had reductions in our current year (when) the state made reductions in its biennial plan; so it's not unlike the state to basically try to reconcile its expenditures and its revenues," Finch noted.

He also pointed to Fitch Ratings' May 19 Connecticut Bond Rating Report (On May 19, both Fitch and Standard & Poor's announced their　credit ratings for CT General Obligation bonds dropped from AA to AA-).

Finch said the Fitch report, "...talked about some of the structural imbalances at the state. They said it remains unclear whether the state has fully succeeded in aligning its budget to future economic and revenue performance. So our outlook on this is we're not alone in the message here."

BOF chair Joseph Mooney reminded the BOF of a similar message heard at the beginning of the May 23 meeting from the town's financial advisement firm.

"The financial advisors tonight are saying there's still uncertainty in the economy," said Mooney. "And the economy does drive the state revenues, which in turn has an impact on some of the grants that may be coming our way -- particularly in the second half of the next fiscal year."

Mooney also said Gov. Malloy had not signed the budget into law (as of May 23) as work was still being done at the state level to finish up bonding packages and other proposals, together with remaining "lapses" in monies to be allocated to state agencies.

"So there's a lot of uncertainty," said Mooney to the BOF. "The package you see before us tonight is a conservative one and (the) right approach."

Cosgrove commended the BOF and RTM for responding proactively to potential state aid impacts.

"Certainly these are prudent measures that I think we ought to be taking. Although the future is somewhat uncertain, I think the one certainty is the state is going to continue to face these fiscal challenges for the next few budget cycles at least; nobody's disputing that.  I just appreciate the work the Board of Finance and the RTM have put into this budget; in really evaluating the requests and making some significant adjustments but yet taking an approach where they weren't cutting any services or putting any projects in jeopardy," said Cosgrove. "We're fortunate to be in the position where many other municipalities are not."