Federation of Connecticut Taxpayer Organizations

From FCTO:� The Demise of House Bill 6956 Raised Bill [pdf] is due to the successful efforts of Mike Guarco and the Connecticut Municipal Consortium for Fiscal Responsibility which continually kept FCTO aware of its status and which you, the members of FCTO, helped to defeat by your phone calls and emails to your State legislators.� The Consortium is comprised of public officials from 114 municipalities who are working tirelessly to convince their state representatives that our high property taxes are driven by State Mandates which must be reformed to provide property tax relief.� The Consortium has received the well deserved recognition of the Waterbury Republican Newspaper for their efforts.

FCTO EXTENDS ITS APPRECIATION TO MIKE AND THE CONSORTIUM FOR ALL OF THE WORK THEY HAVE DONE ON THE TAXPAYERS� BEHALF!� TO ALL TAXPAYERS WHO CALLED THEIR STATE REPS TO DEFEAT THESE BILLS, GREAT JOB!� YOU SHOULD BE PROUD!�

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Editorial by the Republican-American Newspaper

LEGISLATURE: Bad bill flushed, Tuesday, June 12, 2007

Editorial by the Republican-American Newspaper

In the last days of the legislative session, we had an inkling a bill that would shift from public-safety workers to taxpayers the burden of proof for workers'-compensation claims for heart disease and some cancers and infections diseases was in trouble: Rep. Jeffrey J. Berger, D-73rd District, had gone from its chest-thumping defender to "just a co-sponsor" of a bill "written by a labor attorney."

Ultimately, the measure that even such labor lackeys as the Conference of Crying Mayors and The Hartford Courant despised died on the House calendar, not from neglect but from a relentless campaign waged by a growing force at the Capitol, the Connecticut Municipal Consortium for Fiscal Responsibility. Formed in 2004, the consortium represents 114 municipalities fed up with the socialism and unionism that are dragging down the economy and impeding municipalities' ability to deliver basic public services at a price taxpayers can afford. Its main targets are unfunded mandates, prevailing-wage laws and binding arbitration.� Rep. Berger's bill would have been another unfunded mandate that could have cost cities and towns upward of $1 million per claim, multiplied by the thousands of paid and volunteer police officers, firefighters and emergency-medical technicians it covered. Those personnel already have access under state law to heart-and-hypertension benefits; the big difference is they now must prove their illness is job-related, a reasonable burden.�

The death of the bill was no small victory for the consortium, given the steep odds it faced going in. Led by Michael Guarco, a Republican from Granby, and Arthur Johanson, a Democrat from Burlington, the consortium has earned the respect and gratitude of the taxpaying public. Its members serve as shining examples of what principled people can achieve when they are willing to fight for what's right, even when their cause seems hopelessly lost. Let's hope this victory over Big Labor inspires other municipal officials to take up the challenge.

Editorials written by members of the Consortium are highlighted below�.

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Click to read the 2007 EMINENT DOMAIN REPORT CARD

CONNECTICUT RECEIVES AN F

ARLINGTON, VA�If your home is important to you�and whose home isn�t�should read a report card just released that grades eminent domain reform legislation in all 50 states in the past two years.

The report was released by the Castle Coalition, a grassroots project of the Institute for Justice, which argued the Kelo eminent domain case before the U.S. Supreme Court. The Castle Coalition examined and graded eminent domain laws for each of the 50 states over the past two years�since the Kelo decision allowing eminent domain for private gain.

�This report finds that your right to own your home free from the specter of eminent domain abuse depends on which state you live in,� said Steven Anderson, director of the Castle Coalition. �States in the Northeast as well as California remain some of the biggest abusers of eminent domain and legislators in those states have so far refused to pass meaningful eminent domain reform despite the public�s overwhelming desire to be protected from eminent domain for private gain.� The report is available here.

Among the states that passed the strongest reforms protecting property owners are Florida, Michigan, Nevada, New Mexico, North Dakota and South Dakota, each of which received an A or A- grade. States that received F�s were: Arkansas, Connecticut, Hawaii, Maryland, Massachusetts, Mississippi, New Jersey, New York, Oklahoma and Rhode Island.

�In only two years since Kelo, 41 states have reformed their laws to offer greater protection to small property owners,� said Jenifer Zeigler, legislative affairs attorney with the Castle Coalition. �But much more work remains if homeowners, small business owners, churches and farmers are to be safe from the unholy alliance of tax-hungry governments and land-hungry developers.�

The report seeks to step back and evaluate the legislative work that has been done and is left to do. It finds, �Some states have passed model reforms that can serve as an example for others. Some states enacted nominal reform�possibly because of haste, oversight or compromise�and need to know what is left to fix. And finally, there are those states that have failed to act altogether, leaving home, farm and business owners threatened by Kelo-type takings and beyond.� � 6-06-07

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Updated: DeLuca Affidavit Reveals Close Ties With Galante

by Christine Stuart | June 1, 2007 6:06 PM

The arrest warrant affidavit that lead to Senator Louis DeLuca's arrest Friday claims DeLuca had a "close and confidential relationship with" Danbury trash hauler James Galante, who has ties to a Genovese crime family member.

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I-84 Contractor Responds to State Officials and CT Citizens

by CTNewsjunkie Staff | June 1, 2007 9:55 AM
Posted to Legal

Stephen Hallberg, the former president of L.G. DeFelice and current president of Hallberg Contracting Corp., sent this letter to Gov. M. Jodi Rell and the citizens of Connecticut defending his company�s reputation and decisions it made.

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February 20, 2007

Municipal, school boards, seek prevailing wage reform
By: William Baxter and Richard Ohanesian�

Municipal officials want their communities to be places where residents earn a decent living and maintain a high quality of life. We want workers to be paid fair wages. And we want property taxpayers to get the best bang for the buck. However, the state has imposed a law that requires municipalities - and the state - to pay for unnecessary and seemingly exorbitant wages on public projects at the expense of taxpayers.

Connecticut has on the books an unfunded state mandate that requires municipalities and the state to pay so-called prevailing wages on construction projects costing more than $400,000 for new work and more than $100,000 for renovations, if the projects are partially funded by the state. Don't be fooled by the phrase "prevailing wage" - we are really talking about circumstances of "excessive wage."

This law does not apply to the private sector. The law means that state and local projects cannot be bid to obtain the lowest responsible price because all firms that bid on the project must meet a basic wage and benefits package that is set by the state. These laws prevail despite the expense to state and local taxpayers. Since 1979, eight states have repealed their prevailing wage laws, and 10 other states have no such law.

The term prevailing wage rate is a misnomer. It connotes average wage rate, which sounds reasonable. In fact, prevailing wage rates are markedly higher than average wages. For example, the entry-level rate for electricians is about the same statewide as it is in Hartford ($18.50 and $18.60, respectively). The prevailing wage rate, however, set by the state is $29.30, or 58 percent higher.

A decade ago, the Connecticut Advisory Commission on Intergovernmental Relations concluded that prevailing wage rates increase construction costs to towns and cities upward of 21 percent annually. The Wharton School of Business has reported the figure to be up to 30 percent. In December 2001, the Kentucky Legislative Research Commission determined that the prevailing wage mandate resulted in a 24 percent increase in the wage cost of state and local projects.

Regardless of the specific percentage of cost increase, there is no dispute that the prevailing wage mandate forces municipalities and the state to pay tens of millions of extra dollars every year for public works projects. Every project, such as school construction and highway and bridge repairs, is artificially made more expensive by this law.

Yet, despite this, efforts to reform the prevailing wage law die in the Connecticut General Assembly each year. This year, there is an effort emerging to lower the thresholds, in effect making the few projects that still fall under the thresholds even more expensive for towns ... and taxpayers.

The Connecticut Conference of Municipalities, the Connecticut Council of Small Towns and the Connecticut Association of Boards of Education have joined with a newly formed bipartisan grass-roots group - the Connecticut Municipal Consortium for Fiscal Responsibility - to call for an increase in the prevailing wage threshold to $1 million for new construction and renovations projects and to provide for indexed increases for such projects thereafter.

Most supporters of reform would prefer to eliminate the mandate, but increasing the threshold is a compromise that would be fair to both sides. The prevailing wage thresholds have not been adjusted since 1991. The 16-year absence of adjustments has cost the state and towns and cities tens of millions of dollars annually.

Labor contracts falling under the current prevailing wage criteria drive wage schedules up every July 1 with cost-of-living adjustments that year after year affect the cost of construction, thereby strengthening the argument to raise the threshold and indexing it to reflect inflation.

Savings from prevailing wage rate reform can be used to finance additional state and local infrastructure programs. All construction workers would benefit from increased public work being done statewide. Small and medium-sized contractors would be able to compete for jobs. Taxpayers would benefit from quality work at a lower cost.

The time for reforming this mandate has come.

William Baxter is first selectman of of New Hartford and Richard Ohanesian is chairmain of the board of finance in Canton. They are members of the Connecticut Municipal Consortium for Fiscal Responsibility, a bipartisan grassroots alliance of boards of selectmen, education and finance that focuses on cost management and has members on 191 boards representing 113 towns and cities.

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State Must Relieve Municipal Mandate Burden
ARTHUR JOHANSON and MICHAEL GUARCO
May 8 2007� Hartford Courant

This year, especially, there is a lot of talk about property tax reform and a tax cap. However, little is said about the most important tool in accomplishing both - the necessity to strengthen the ability of municipalities to manage their own budgets, effectively and efficiently. Only by reducing the negative impact of state interventions into local fiscal affairs can meaningful reform be realized. The steadily decreasing control that towns have over the cost drivers in their own budgets is the primary cause of the property tax dilemma we face.

Statewide in this decade, while yearly property tax rate increases have been running at 5 to 6 percent, overall municipal employment has been flat and declining. At the same time, the rate of rejection of local budgets has doubled and tripled from 10 years ago. Against this backdrop, the many volunteers who serve on local boards and commissions have begun fighting back - coming together to support the Connecticut Municipal Consortium for Fiscal Responsibility. This is a broad alliance that ranges from council members, selectmen and aldermen to boards of education and finance.

Since its inception in 2005, nearly 200 boards from more than two-thirds of the state's municipalities - towns and cities alike - have joined in endorsing this grass-roots bipartisan initiative to right the ship, and get equal attention placed upon the expenditure management problem that we face at the local and state level.

Every year, new mandates without legislative funding get dumped on the towns, driving up costs - and taxes. With nearly 80 percent of the typical municipal budget being for wages and benefits, state labor mandates constrict the ability of local boards to manage costs effectively. Such mandates dangerously accentuate the political and fiscal problem of unbridled public sector compensation, which outpaces that of the vast majority of our taxpayers. Meanwhile, good programs get choked from local budgets, a result of the imbalances in Connecticut's protectionist binding arbitration system.

The state prevailing wage law is another protectionist policy from the past - a relic of the Depression era - that drives up municipal project costs and effectively reduces the competitive mix of bidders on local projects. This increases what local taxpayers must pay by 10 to 30 percent, according to study after study from across the nation. It also mandates the highest wages in the region, rather than average or competitive compensation.

In Granby's case, the excesses of prevailing wage cost taxpayers nearly $1 million annually or 3 to 4 percent of each property tax bill. That is why so many states have never had or have repealed this costly mandate, and why the National Association of School Boards and even the federal Government Accounting Office have called for its elimination.

While many believe that the time for repeal of such costly mandates may well be here, the General Assembly, at least, should update the minimum cost of a municipal project to which the prevailing wage rules apply. This would reflect the substantial increase in construction costs since 1991, when the current levels were set. The language in House Bill 6640 - raising the project cost threshold to $1 million from the current levels of $400,000 on new work and $100,000 on renovations, with indexing to construction inflation going forward - is the reasonable compromise that would provide some real relief for local taxpayers. This bill has been supported through sponsorship and in committee vote by 20 percent of the combined legislative chambers. It is refreshing to see at least some legislators stand tall in representing all of their constituents and not just perpetuate what benefits special interests.

As taxpayer rebellion burns across the nation, and in the towns and cities throughout our own state, discussion around the Capitol goes on about taxing us more just to send some of it back to the municipalities to slow the increase in property taxes. The governor also has proposed a property tax cap, but it will fail unless accompanied by meaningful reform of the mandates that accelerate the slow but steady squeeze on local programs.

Real change only can happen by strengthening the ability of municipalities to manage their own fiscal matters.

At no cost to the state, the legislature can enact reforms that will do exactly that, thus flattening the municipal cost curve for the future. If moderate reforms had been enacted years ago, Connecticut wouldn't be in its current fiscal crisis. Indeed, the property tax cap and reform issue would have been nipped in the bud by putting the responsibility and power to handle budgetary matters back where it belongs - at the local level.

Arthur Johanson, a Democrat of Burlington, and Michael Guarco, a Republican of Granby, are longtime board of finance chairmen. They are among the founding members of the Connecticut Municipal Consortium for Fiscal Responsibility - an alliance of 192 boards and chairmen from 115 towns and cities.