North Branford Town Council voted 5-4 on party lines April 18 to recommend a $50.558 million 2017-18 budget with a 1.5 mill rate bump to 33.51 mills, representing a 4.7 percent annual tax increase to property owners next year.

While the council's budget recommendation is set, the new mill rate won't be set until after the town's annual budget referendum question on the council's recommended budget takes place on Tuesday, May 9. The vote will ask if electors feel the council's proposed $50,558,303 2017-18 town budget should be accepted, rejected as too high, or rejected as too low. By Town Charter, the vote on the question requires a minimum 15 percent voter turnout at the polls for the results to be "actionable" by Town Council.

The council is made up of Democratic Majority council members Joseph Faughnan (Deputy Mayor), Marie Diamond, Dan Armin, George Miller and Chris Manna and Republican council members Michael Doody (Mayor), Anthony Candelora, Rose Marie Angeloni and Al Rose.

Mayor Doody followed up the April 18 vote with the caution that a continuing trend of state revenue shortfalls will lead to "bleak" town budgets in the coming years, and the caveat that the town may have to issue amended tax bills should any unanticipated state cuts hit in the 2017-2018 fiscal year.

To close an anticipated $2.2 million state revenue shortfall expected in 2017-18, the council voted to spend nearly $1.5 million in debt service savings, together with using an unprecedented $750,000 from the general fund surplus.

The council also decided not to make provisions for a potential $1.4 million in additional state costs which could arise should Governor Dannel P. Malloy's proposed municipal funding of the state Teachers' Retirement Fund be enacted.  As previously reported, the council used information gathered from state representative leaders and also followed the lead of several other municipalities to determine the retirement fund proposal will likely not be enacted this legislative session. However, the subject is still up for debate in Hartford, where legislators aren't expected to set the state budget until well into June; if not July. If Gov. Malloy's proposal is enacted, North Branford would have to issue amended tax bills to generate the needed revenue, as Mayor Doody noted.

Due that factor, "...our budget's like a guesstimate," Doody said. "Because it doesn't include the $1.4 million the state has proposed on their behalf (from North Branford) for the Teachers' Retirement funding. So if that passes through the legislation, then the town is on the hook for another $1.4 million. Therefore, there will be additional tax bills coming out to incorporate that cut from the state."

For the 2017-18 budget year, North Branford will be able to absorb much of the $2.2 million state shortfall impact by taking advantage of a significant dip in long term town bonding cost expenses (debt service). In 2017-18, North Branford's debt service costs will drop by 25.58 percent over 2016-17 costs. The savings of $1,474,455 was supposed to allow the town to begin on some long-awaited capital improvements in 2017-18. Instead, the town will now be pushing that money into the gap created by the state.

"That is being used to keep the mill rate low – if you consider a 1.5 (mill) increase low," said councilwoman Angeloni. "Had we not had that money in there; and with all the state's cuts, we were looking at close to a four and half mill increase, originally. So, unfortunately, we have used that money to keep our mill rate lower this year. And unfortunately, the projections from the state do not look good going forward in other years. So it is only going to become more difficult for us as we continue on in future years, [beginning] next year. Our budget is pretty lean, and the only place, if the state continues like this, that we will be able to find money, is eliminating positions. And that is the picture of what we're possibly looking at going forward."

Overall, the proposed 2017-18 town budget represents a less than zero (-0.86 percent) spending increase year-to-year. The budget recommends $14,881,030 for town government costs (an annual increase of 2.29 percent) and $30,998,053 for schools (an annual increase of 1.01 percent).

Noting the town also is using three quarters of a million dollars from the general fund surplus to help balance the 2017-18 budget – more than twice what the town has ever used in the past – Doody said, "...the town put up a lot of money that they're not going to have in the future. It really looks bleak for the rest of us council members, along with the state, and every citizen in the state of Connecticut."

Ahead of the final budget recommendation vote on April 18, the council managed to reduce proposed town government expenses by $134,799 largely by reducing full-time, part-time and over-time budgets as well as social security and pension numbers, in several departments. Some line items were cut by as little as a few dollars, while bigger hits included cutting $30,626 from proposed police overtime and $20,525 from proposed Public Works full-time salary costs. The council also worked to transfer funds from different areas within the budget to allow for a few requested items, such as moving $23,125 from the overtime area of the police budget to help fund the first payment of a year-to-year lease of two new police vehicles (valued at $90,000). The council also approved an appropriation of $150,000, to be made up by reducing school health insurance budget costs by $150,000; in order fund the capital for the installation of needed boilers at North Branford High School.

One hotly contested new 2017-18 budget expense which divided the council along party lines on April 18 was a motion by councilman Armin to add $25,000 as salary to hire a part-time Economic Development Coordinator/Grant Writer; with the money to be funded from the town's ambulance revenue subsidy fund.

Pointing out that the ambulance revenue fund was already in the red, councilman Al Rose said the suggestion to take money from it to pay for a new, $25,000 part-time Economic Development Coordinator/Grant Writer was "asinine."

"Why would you take it out of a shortfall already?" Rose asked, saying it would be better to instead make a motion to fund the position with tax dollars.

"Make it stand alone and let the people vote on it," said Rose. "To me that is asinine, to take it out, if we know it's short already."

Councilwoman Angeloni said the council's Democratic majority had voted not to keep approximately $58,000 in the 2017-18 budget to fund the salary of a new Public Works supervisor; and said the public works position was more needed as a town service, in her opinion.

The supervisor position was to be a continuation of a hiring authorized beginning January 2017 in the 2016-17 town budget, passed by a majority Town Council vote; although the position has not yet been filled this year. Now, even if the Public Works position is filled by the end of the 2016-17 fiscal year, there is no money in next year's budget to continue it, said Angeloni.

"We have in this year's [2016-17] budget a position for a superintendent for Public Works to start in January for $58,000-plus that was passed the majority of this council last year, that we have not filled. I feel that that position is far more valuable than an Economic Development person, given all we have done already this year for economic development," said Angeloni.

She pointed to the 2016 town-council approved business assessment (tax) deferral program, the council's actions to demolish town buildings at 1599 Foxon Road to create a more marketable town center development site, and efforts to connect sewers at the Mill Pond commercial property in Northford to generate interest from developers. Angeloni also noted the town has limited available land to be encouraged for development or redevelopment by large commercial properties.

Deputy Mayor Faughnan said Armin's motion was about hiring an Economic Development coordinator/grant writer and not about a Public Works supervisor position.

"Whether or not you need an Economic Development person should be the sole consideration at this point in time, on that motion," said Faughnan. "And I'm not taking a position either way, but [to say] that we have limited developable land is not the sole issue. We do have needs in terms of vacant storefronts, of bringing other businesses into the town which are not necessarily large land users; and the need for grants that can obtained. I think it goes without debate. I think the question ought to turn on whether there's that need, and whether it's justified to spend up to $25,000 to fill it. Separate from that [is the question of], is there a need for additional personnel in Public Works, and what should the price be, should we fill it?"

Following the 5-4 Democratic party-line vote to add in $25,000 for a part-time Economic Development Coordinator/Grant Writer, Councilman Rose then made a motion to cut next year's $4,800 Regional Economic Xcelleration (REX) expense, asking Armin what results the service produced for the EDC in 2016-17.

"This was a thing you guys put it in last year," Rose said of the council's Democratic majority. "What did we get for a benefit? I do know they told us this town has highest debt per capita, which I've been preaching for 10 years."

Armin said the results from REX as well as those from the new economic development position will need to be gauged in the long-term.

"I don't know specifically what [REX] did this year [but] this is not the type of funding that you're going to get immediate gratification out of. But it does work – it works for Branford, it works for Guilford," said Armin. "This is a long-term goal. We have to increase the income of this town to increase tax revenue. Because otherwise, we're going to be worried about cutting $10 out of line items. The only thing that's going to do anything for the health of this town is increasing revenue; and it can't be on the backs of my tax dollars, or anybody else's tax dollars individually. It's got to be a long-term goal in our town."

Rose's motion to remove the $4,800 item was defeated on party lines by a Democratic majority vote. Following the meeting, The Sound asked Rose if the final budget vote, with the entire Republican minority voting against the $50.558 million bottom line the full council had worked to craft, was a referendum on the night's earlier party-line votes.

Rose said he still felt funding the new part-time Economic Development Coordinator/Grant Writer position with the underfunded ambulance revenue fund was a "bonehead" decision that "just didn't make any sense."

Rose also said it was "unusual" for the council to come down to a party line vote on the proposed annual budget, adding, "We get along great, as a council."