Town ex­pects to close out 2018 in the black

New Haven Register (New Haven, CT) - - LOCAL NEWS - By Ben Lam­bert

HAMDEN – After shift­ing funds to ad­dress a mul­ti­mil­lion-dol­lar deficit, the town ex­pects to end the 2017-18 fis­cal year in the black, ac­cord­ing to Mayor Curt B. Leng.

In a Nov. 30 memo to coun­cil mem­bers and town staff, Leng said the FY

2018 bud­get had been bal­anced “de­spite what was un­ques­tion­ably a year of chal­lenges ... largely caused by the State of Connecticut’s mid-year, un­ex­pected mul­ti­mil­lion-dol­lar cut of an­nu­ally re­ceived state rev­enue.”

Spend­ing was de­creased by more than $7 mil­lion , Leng said.

In the memo, he said the town se­cured the money in a number of ways, in­clud­ing in­sti­tut­ing spend­ing and hir­ing freezes, col­lab­o­rat­ing with the Board of Ed­u­ca­tion, and cut­ting planned pen­sion and cap­i­tal ex­penses.

Most of the money came from the lat­ter two cat­e­gories.

The town’s 2017-18 bud­get called for $17.7 mil­lion to be put to­ward the town pen­sion li­a­bil­ity; that was

“Adding to our debt to plug holes in our bud­get — it’s just very ir­re­spon­si­ble.” Lau­ren Gar­rett,

Leg­isla­tive Coun­cil mem­ber

cut to $12.7 mil­lion.

More than $3.7 mil­lion was swept out of the cap­i­tal bud­get, as the town closed out, scaled back and, in some cases, can­celed projects.

Th­ese ac­tions did not need Leg­isla­tive Coun­cil ap­proval, ac­cord­ing to Leng, as they con­sid­ered an ad­min­is­tra­tive func­tion, rather than a bud­get trans­fer.

The Leg­isla­tive Coun­cil did sign off on $1.7 mil­lion of trans­fers at its Mon­day meet­ing, which, among other line items, cov­ered $752,000 of pen­sion ex­penses, $253,366 of po­lice over­time costs, $275,000 in pre­vi­ously-pro­jected at­tri­tion sav­ings, and $192,934 in sub­sti­tute fire­fight­ers.

Ac­cord­ing to Clerk Kim Renta, coun­cil mem­bers Lau­ren Gar­rett and Cory O’Brien voted against the trans­fers, as did Justin Farmer and Harry Gagliardi. Coun­cilor Athena Gary ab­stained.

In in­ter­views con­ducted after the meet­ing, Gar­rett and O’Brien voiced con­cerns about us­ing planned pen­sion funds and cap­i­tal ex­penses to balance the bud­get, as us­ing bonded money to pay for op­er­at­ing ex­penses in­curs in­ter­est; sweep­ing cap­i­tal funds pre­vents in­fra­struc­ture work from be­ing done.

Th­ese prac­tices keep the com­mu­nity from ad­dress­ing its debt bur­den, they said, which, in part, is to blame for the town tax rate.

“(The debt is) one of the rea­sons we have to have a high mill rate. It’s one of the rea­sons we’re fi­nan­cially dis­tressed,” said Gar­rett. “Adding to our debt to plug holes in our bud­get — it’s just very ir­re­spon­si­ble.”

O’Brien and Gar­rett would like to see the town fo­cus more on long-term sus­tain­abil­ity in its fi­nan­cial prac­tices and zero in on what they con­sider overly-high rev­enue es­ti­mates.

The town his­tor­i­cally

has looked to short-term fixes, such as those im­ple­mented this year, to al­le­vi­ate fi­nan­cial pres­sure in­stead of con­sid­er­ing the long-term ram­i­fi­ca­tions of its ac­tions, O’Brien said.

“It’s just a mind­set change,” said O’Brien. “That’s the only way we’re go­ing to get ahead of this and re­ally get things un­der con­trol.”

Michael McGarry and James Pas­carella, the cur­rent and for­mer coun­cil pres­i­dents, said that the cap­i­tal sweep and di­min­ished pen­sion pay­ment were the best of a series of bad op­tions, not ad­vis­able prac­tices. McGarry said other pos­si­bil­i­ties in­cluded fur­ther bor­row­ing or a sup­ple­men­tal tax.

Pas­carella noted the town’s fund balance — which stood at $2.98 mil­lion at the end of the 2017 fis­cal year, ac­cord­ing to its au­dited fi­nan­cials — would have been over­drawn if the deficit was not mit­i­gated, open­ing the com­mu­nity up to re­ceiver­ship.

“I think all those in­volved did the best they could,” said Pas­carella.

“This, ob­vi­ously, is not the way we want to be clos­ing the bud­get,” said McGarry. “We played the best hand we could.”

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