Christine Stuart photo

Seven weeks after she unveiled her budget and a day after she was criticized for not tying her increase in education spending to property tax reform, Gov. M. Jodi Rell unveiled her proposal to cap the amount of taxes municipalities can levy.

Click here to read her remarks from the press conference this afternoon at the Museum of Connecticut History.

In February when Rell released her budget she outlined an unprecedented increase in state education aid and said the increases must be directly tied to property tax relief and improved classroom achievement. Under the plan released Wednesday afternoon municipal property tax increases will be limited to no more than three percent a year beginning on July 1, 2008. There will be four exceptions to the 3 percent cap.

Grand List Growth: Town Grand Lists typically grow by 1.5 percent to 1.9 percent per year without special situations such as the development of a new subdivision, shopping mall or industrial site. Any growth in a municipality’s Grand List over 1.5 percent – other than motor vehicles – may be added to the property tax increase for that year

Debt Service: Expenses related to paying for capital projects are exempt from the limit, but only for the life of the bonds

Override: The limit may be exceeded on a vote of two-thirds of the municipality’s legislative body and a simple majority vote of residents

Emergencies: The limit may be exceeded in the event of a natural disaster, fire or other emergency

While they didn’t balk at the idea of capping municipal budgets, Democratic legislators wondered if Rell’s proposal attacked the problem or just the symptoms.

State Rep. Cameron Staples, D-New Haven, said he didn’t know how the state that can’t abide by its own spending cap is able to ask municipalities to uphold one of their own. He said current services such as salaries, special education costs, and energy prices are driving the state budget beyond the 3 percent mark. He said Rell’s proposal doesn’t go after those spending drivers which means it “addresses the symptoms, but not the problem.”

On Monday this week the Education Committee edited Rell’s education spending proposal. The committee’s plan ranked towns based on the amount of money they now spend per student and decided that the lowest-spending towns will be required to spend the highest-percentage of the new state money on education with the remainder going to property tax relief.

Education Co-Chairman Rep. Andrew Fleischman, D-West Hartford, said Wednesday since the governor announced her budget proposal the Democrats have been open to having discussions with her on making the distinction regarding how the education spending would be directly tied to property tax relief for the towns. He said Rell’s education proposal was a “boon for the wealthiest towns at the expense of the neediest.”

Overall he said the rough draft of what the Democrats budget proposal will look like when it’s done will give $36 million more to cities and towns than Rell budget presented in February.

Office of Policy and Management Secretary Robert Genuario told the Hartford Courant that “the Democratic plan does not provide for the proper use of state money for Hartford, which would be allowed to use more money for tax relief than for education spending under the committee proposal.”

Click here to read the Senate Democrats reaction to the proposal.