Towns
that would lose millions concerned with Malloy’s lack of deal
By Ed Jacovino
Journal Inquirer
Published: Thursday, April 14, 2011 10:06 AM EDT
HARTFORD — Plans to
reverse a cut that would strip $49 million in state aid to towns under Gov. Dannel P. Malloy’s budget haven’t been worked out yet, and
those eager for a deal voiced frustration Wednesday.
“I’m not happy that we didn’t have this thing already settled,” Sen. Gary D. LeBeau, D-East Hartford,
said. “I’m worried about this being part of a last-minute budget deal.”
Malloy’s proposal calls for eliminating a state refund to towns for property
tax-exempt manufacturing machinery and equipment. The governor wants to keep
the machinery off the local tax rolls, but not reimburse towns for the lost revenue.
For East Hartford, that would mean losing
about $3.6 million. The town, home to Pratt & Whitney, was the largest
recipient of the reimbursement this fiscal year.
South Windsor, Stafford, Suffield, Windsor,
and Windsor Locks also stand to see an overall decrease in revenue without a
change to Malloy’s plan, according to an analysis by the Connecticut Conference of Municipalities.
Those losses would come even after counting the new town revenue Malloy
proposed, such as a sliver of the sales tax, hotel and entertainment taxes, and
property taxes on now-exempt boats and airplanes.
Malloy and his staff say they want to ensure towns like East
Hartford aren’t losers in the deal. And lawmakers from East Hartford and other towns that rely on the tax
reimbursement have said they’re convinced the issue will be resolved.
But there’s no plan in place yet, LeBeau said late
Wednesday. “It was a general assurance,” he said of agreement with Malloy
budget officials. “It wasn’t anything specific about how it would be worked
out.”
Timothy F. Bannon, Malloy’s chief of staff, said
today that many budget specifics are in flux. “I wasn’t aware that anyone had
established a deadline for a specific agreement,” he said.
Malloy was expected today to announced changes to his budget, revisions that
follow a 17-stop tour of the state in town hall-style meetings.
James Finley, executive director of the Connecticut Conference of
Municipalities, also raised concerns over the lack of a solution. “There has
not been the progress that we would expect, I think, at this point,” he said.
Finley’s comments came during a news conference Wednesday in which municipal
leaders largely praised Malloy’s budget. Malloy kept level the biggest grant to
towns — for education — and added the additional revenue.
“We’re still talking to the Finance Committee that has jurisdiction over the
implementer bill proposed by the governor,” Finley said. “We have ongoing
discussions with the governor’s office at the highest levels.”
Rep. Timothy D. Larson, D-East Hartford, also thought there had been a deal.
“This is the first I’ve heard that it’s not going well,” he said Wednesday.
Larson predicted last month that the proposal would be changed. His
announcement came after a meeting with members of Malloy’s budget staff.
Rep. Patricia M. Widlitz, D-Guilford, is
co-chairwoman of the tax-writing Finance, Revenue, and Bonding Committee. Widlitz acknowledged Wednesday that there was no deal in
place to continue the funding, but said that doesn’t mean it won’t happen. “We
have every intention of holding the towns harmless,” she said.
Widlitz described the budget as “moving pieces.”
“I think we’re getting remarkably close to an agreement,” she said. By “holding
towns harmless,” Widlitz said, she meant no town
would lose money overall, after balancing any new expected money with the loss
in the manufacturing grant.
But for Finley, that’s not enough. Even if the manufacturing towns break even,
other towns stand to gain under Malloy’s proposal. That makes manufacturing-heavy
towns relative losers. “In my view, that’s not an equitable solution,” Finley
said.
LeBeau echoed the sentiment. That plan still would
reward towns with retail — effectively punishing those without it. “We’re
encouraging retail at the expense of manufacturing,” he said.
The five biggest winners under the governor’s plan are located in Fairfield County:
Greenwich, Westport,
Fairfield, Malloy’s hometown of Stamford,
and Darien. The
biggest losers are Middletown, Bloomfield,
Bristol, Stratford,
and East Hartford.