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03/23/2017 03:35 PMBranford's Board of Finance (BOF) is reviewing a proposed $112 million town budget which could increase taxes by 6.2 percent next year and also increase the mill rate by 6.2 percent. A full three percent of that mill rate increase can be attributed to Governor Dannel P. Malloy's latest proposed revenue reductions and added costs which could impact the town.
In addition the governor's proposed cuts to Branford's state municipal aid (Education Cost Sharing and Local Capital Improvement grants), Branford is faced with a potential $2.7 million payment to be made into the state Teachers' Pension Fund. Under the governor's proposal, Branford and 137 other towns would be required, for the first time, to give one third of the annual contribution to help the state shore up the municipal teachers' pension fund.
Branford Finance Director Jim Finch told Zip06/The Sound the potential impacts coming down from Hartford have Branford facing it's most "unusual" budget in his nearly 20 years with the town.
"It's the most unusual budget as it relates to state aid, because not only are there reductions, but there's also a requirement for us to pay something," said Finch.
The 2017-18 requested town budget was delivered to the BOF for review on March 20 by Finch and First Selectman James B. Cosgrove. The budget's bottom line totals $112,424,671 which is an increase of $6,533,454 over last year's spending.
With the exception of Public Works, which will be reviewed on March 23, the BOF reviewed all other town government department budget expense requests during workshops held on March 20 and March 21. The town government side of the budget for operating, capital and lease expenditures comes in at $43,800,583. On March 21, the BOF also heard from Finch on 2017-18 debt service costs, set at $8,333,060.
On Thursday, March 23, the BOF will review the proposed 2017-18 Board of Education (BOE) budget of $59,058,491, which includes the $2.7 million proposed state expense to the town, creating a total annual school budget increase of nine percent. See the story on what's in the 2017-18 BOE-approved budget (without the state proposed costs) here.
The two town departments with the largest annual budget requests are Police ($6.35 million) and Fire ($5.45 million). A significant operating increase requested by police for 2017-18 is a $115,000 salary for a new Deputy Police Chief. Re-introducing the rank to the police department is needed to help transition leadership as the department's three senior members, including Chief Kevin Halloran, Captain Ray Dunbar and Captain Geoffrey Morgan, go into retirement within the next few years, beginning in 2020. Chief Halloran will retire in 2021.
The Fire Department's requested expense increases include $127,634 to add part-time staffing to the department to man increasingly rising calls for ambulance services. The funds are requested as the second year of a three-year staff growth plan outlined by Fire Chief Tom Mahoney. Revenue generated by the service covered last year's increase (by October 2017) and Mahoney anticipates the same will happen in 2018. The fire department is also seeking an expense increase of $57,849 to cover rates and costs for hydrants and mains, including an installation program in the Queach area, a 17 percent increase over last year.
Fire Department capital expenses requests include $162,000 for an ambulance replacement and $198,00 for radio system upgrade that includes police, fire and emergency radio services. In police department captial expense requests for 2017-18, the department is seeking $179,764 to purchase four patrol vehicles.
Following a budget workshop on March 23, on Monday, March 27 the BOF will vote on a recommended budget to pass on to the Representative Town Meeting (RTM). Once the RTM completes committee reviews and the full RTM votes to adopt a final budget, the BOF will have until June 1, at the latest, to set the new mill rate. As the proposed 2017-18 Branford Town Budget currently stands, the mill rate would increase to 29.08 mills, up by 6.2 percent or 1.7 mills. The current mill rate is 27.41. Used to calculate property tax, the mill rate represents the amount per $1,000 of the assessed value of property.
Finch said the town's proposed budget is taking the right approach to build in what he describes as the "worst case scenario" Branford could face next year, should the governor's state budget proposals succeed. Part of the problem also facing Branford and most other towns is that the state budget process lags behind the town's budget process calendar. To meet Town Charter requirements and start the fiscal year on July 1, the town mill rate, based on the approved town budget, needs to be set no later than June 1. But the state budget won't be finalized until the end of the legislative session in early June.
Further complicating matters are the rules governing how Branford can approach its budget.
For example, "...once the Board of Finance cuts a budget, the RTM cannot increase it," Finch said.
So instead of possibly cutting the governor's proposed $2.7 million from Branford's proposed budget, the BOF and the town needs to keep an eye on state budget developments, such as those anticipated to come about in April, when the work of the State Appropriation Committee and State Finance Committee will focus on addressing proposed municipal aid issues.
"What if, in April, the Appropriation Committee and the Finance Committee of the state of Connecticut essentially say [town contributions to the teachers' pension fund] is still in play, but it's a different amount?" such as a phased-in expense, said Finch. "So the approach the town is taking, up until this point, is to continue along the path of the worst case scenario."
While a better picture of what Branford will be facing next year should emerge from the state committees in April; Cosgrove, Finch and the BOF proactively invited Branford's state legislative leaders to town on February 27 to discuss the legislative process and to begin to strategize on addressing potential impacts (see the story here).
"That meeting was a good starting point," said Finch, who provided State Representatives Lonnie Reed (D-District 102) Sean Scanlon (D-District 98) and State Senator Ted Kennedy Jr. (D-District 12) with an outline of anticipated impacts to the town.
Next, Finch further described what the town is up against due to the state's proposals, as well the guidelines Branford works to stay within when developing its annual budget, in a March 16 budget letter BOF chairman Joseph Mooney. The letter includes a table showing the tax requirements to support a nine percent increase to the school budget.
"While this increase represents a bitter pill to swallow, it is important to underscore the Governor's proposal will most certainly undergo a series of transformations prior to scheduled budget adoption in June," Finch wrote. "Unfortunately, this will occur after our budget is adopted. I suspect the Board of Finance and RTM may need to schedule special meetings to react and respond to these changes. As we noted [the] recommendations of the State Appropriations Committee and Finance Committee should provide more insight and direction as to the legislature's philosophy on municipal aid."
Finch summarized, "... the requested budget should be viewed as a first stop on what appears to be a difficult budget journey. The administration does not view this as a cause for panic, instead it believes the public is best served by a prudent approach which includes accounting for the worst case scenario, and working with our state delegation and municipal advocacy groups to monitor the activities at the capitol so that we may reasonable and informed decisions throughout our budget development."