WETHERSFIELD, CT — In anticipation of what Democratic Gov. Dannel P. Malloy has telegraphed will likely be reductions in state funding for municipalities, local elected leaders came up with their own proposals to increase taxes and reduce unfunded state mandates.
Gathered at the Keeney Memorial Cultural Center in Wethersfield Wednesday, local elected officials from all over the state of Connecticut insisted that if the governor and lawmakers were willing to implement even part of what they were proposing then there’s less reason for them to increase property taxes.
“We’re not just asking for help, but we’re putting a proposal out there some positive ideas that are credible,” Bridgeport Mayor Joe Ganim said.
He said for years the state has talked about the burden of the property tax—the only tax municipalities can levy—but unless the state “takes its little handcuffs off us a little bit with some of these opportunities it’s going to continue to be the burden.”
Municipal officials said they want more control over education spending and they want to expand the sales tax base. They also want to levy a statewide local sales tax of 1 percent and with “voter approval” allow municipalities with regional councils of government to impose a 1 percent local sales tax on food and beverages sold in restaurants, and on hotels.
Hartford Mayor Luke Bronin said if the state adopted the proposed changes to the sales tax, it would put his city on stable footing and help him avoid a state bailout or bankruptcy.
“This presents an opportunity to change that dynamic,” Bronin said.
He said he changes in the report position cities like Hartford, New Haven, Waterbury and Bridgeport to grow, but it also helps small towns alleviate some of the residential property tax burden.
The report was not without some immediate criticism from the small business community.
“Expanding the sales tax, increasing our tax rate or making our tax structure more complicated than it already is will propel the state into a downward fiscal spiral,” National Federation of Independent Business Connecticut State Director, Andrew Markowski, said. “Small business owners have been doing more with less for years, and the time has come for Connecticut’s elected officials at all levels to do the same.”
Local officials also want to make sure their current property tax base does not erode and they want to prevent any more property tax exemptions. One proposal would even require owners of tax exempt property to pay the difference between the partial payment the state makes to municipalities and what the municipality would receive if the Payment-In-Lieu-of-Taxes program also known as PILOT, were fully funded.
Connecticut Conference of Municipalities CEO Joseph DeLong said the report is a “holistic” approach to the problems the state and municipalities face. But he said the report is different because “it goes into a deep analysis of the challenges that not only Connecticut faces, but also how those changes line up with the opportunities and realities of the country as well as the rest of the New England states.”
The 1 percent statewide local sales tax, according to DeLong, would generate $670 million annually for local government and require that $324 million be used to fully fund the PILOT formula and the $346 million remaining should be distributed under the current formula for local construction projects.
North Haven First Selectman Michael Freida said local elected officials came together in a bipartisan fashion to develop the 80-page report. One of the recommendations Freida highlighted was a proposal to change collective bargaining rights for municipalities when they want to come together and share services across town lines. The proposal calls for coalition bargaining.
He said they don’t want those shared services to be an obstacle.
He said in his town they’ve shared trucks and other equipment with other local governments, which means the taxpayers of North Haven are not solely responsible for maintaining that share equipment. He said they would like to be able to do that with other services, but are hindered most times by collective bargaining arrangements.
He said it would also allow them to work more closely with local boards of education.
He said they want to “extricate themselves from any state mandates that don’t allow them to look at efficiencies between towns and cities and boards of education.”
The report calls for increasing the power of local governing or legislative bodies to reject arbitrated awards by a two-thirds vote. It also calls for the creation of a task force to review and recommend changes to municipal labor laws.
Lori Pelletier, president of the Connecticut AFL-CIO, said the proposal seems to say “if we could just pay workers less then we’d be okay.” She said the idea too that if they were able to levy an additional sales tax that it couldn’t be considered as part of a municipality’s ability to pay when a contract goes to binding arbitration is “just really awful.”
Municipal leaders also want the state to take over special education and then work with municipalities on delivering those services to those students.
Litchfield First Selectman Leo Paul said there are over 1,200 mandates that have been passed down to the community through the years and many of them are unfunded mandates.
“They ran on no tax increases, but the reality is that many of the mandates that are proposed annually, there is going to be a tax increase,” Paul said. “They’re shifting responsibility from the state to local communities.”
Gov. Dannel P. Malloy, who will give his two-year budget address on Feb. 8, said that he’s happy to have a dialogue.
“I commend CCM for putting new ideas on the table in an effort to confront Connecticut’s economic reality, and for recognizing that part of this year’s budget discussion must include changes to how we provide town aid,” the former Stamford mayor said. “I will present my own vision on February 8th for what those changes should look like, and I look forward to an open dialogue with CCM and other stakeholders throughout this session.”
Waterbury Mayor Neil O’Leary said they want to have a seat at the table when these decisions are being decided.
“We know that not everyone is going to walk away happy,” O’Leary said. “But to be respected and heard. 163 towns unanimous support this report. I believe the governor and legislative leadership will respect our wishes.”