New Britain City Journal

New Britain's Weekly Online Newspaper

Commentary

Connecticut’s Deficit: A Cautionary Tale

In a statement issued on September 4, 2012, State Comptroller Kevin Lembo announced that Connecticut ended fiscal year 2012 with a $143.6 million deficit. State revenues from fees and taxes fell over $225 million short of the target set by Governor Malloy’s budget. Lembo went on to urge caution in the beginning months of the 2013 fiscal year. Spending is only budgeted to increase 2.6% in the upcoming year, but Lembo seems to imply this figure may be unrealistic, saying “This rate of increase is historically low and will require careful monitoring and swift remedial action if [it] trend[s] higher.”

New Britain residents should take careful note of this turn of events, because they could be playing out in our own city as well. Malloy promised that he would reduce government spending through consolidation and employee retirement incentives. He promised that he would increase revenues through additional taxes and fees. Malloy promised a balanced budget; yet at the close of the books, he took over $140 million from the General Fund reserves to cover his shortfall.

When Mayor O’Brien took office, he made many similar promises. O’Brien promised that he would reduce city spending through consolidation and employee retirement incentives. He promised that he increase municipal revenues through additional fines and service fees. He made all these promises, but just like with Malloy’s budget, it appears O’Brien’s budget will fall short of the mark as well.

There are several new revenue lines in O’Brien’s budget. Four in particular include the Anti Blight Fine revenue ($425,000), the Police Call Hotspot Fee revenue ($800,000), the Fire Call Hot Spot revenue ($300,000), and the Non-Owner Occupied Garbage Collection Fee ($3,950,000). These lines total to roughly $5.5 million. I am certain that when the city responds to an FOI request I filed earlier this week with Acting Finance Director Rebecca Salerni it will reveal that as of yet there have been no funds generated in any of these account lines.

Even more worrisome than this potential shortfall of $5.5 million is the line item for over $10.4 million that is listed as “Transition Revenue.” After speaking with multiple members of the Common Council no one was able to explain to me what this extremely large revenue source was, or where the money was going to come from, though I would like to add that Aldermen Freeman, Giantonio, Pabon, and Sanchez all said they would look into the matter for me. It is a bit alarming that members of the Common Council wouldn’t know where just under 4.5 percent of our municipal revenue was coming from. Equally troubling is that almost 7 percent of the city’s revenue is currently missing in action.

The sad fact is that Comptroller Lembo raised an alarm because of a shortfall that was less than 1 percent of the total State budget. Here in New Britain we are facing a far more daunting prospect, a potential shortfall in our budget of over 5 percent unless something drastically changes. I raised concerns about nebulous revenues in the municipal budget back in May, and here we are two months in the new fiscal year and still these questions remain unanswered. Property owners and tax payers beware, we may soon be facing the same budgetary woes of the Malloy administration.

(Mercier writes a story once a month based on concerns of members of the Citizens Property Owners Association. They are not necessarily those of this newspaper.)