nothin Hamden Mayor Proposes 1.6% Tax Increase | New Haven Independent

Hamden Mayor Proposes 1.6% Tax Increase

Sam Gurwitt Photo

Hamden Mayor Curt Leng.

As the elected leader of one of Connecticut’s highest-taxed towns, Hamden Mayor Curt Leng announced a tough decision Monday evening: His proposed new $235,998,505 operating budget will involve raising taxes.

I wanted to deliver a budget tonight with a mill rate reduction,” Leng said in his speech to the Hamden Legislative Council

I came to the conclusion the best way forward was to ensure our services were not only protected, but enhanced,” and to reduce our annual operative expenses moving forward into the future to fund our obligations as best that we can.”

Leng is proposing a .77 mill increase over the current fiscal year budget — from 47.96 to 48.73. The budget, which now goes before the Legislative Council for review, is for the fiscal year beginning July 1.

The 1 percent increase woul raise an additional $2.8 million in tax revenue, he said, and it will cost the median income homeowner an additional $105.

The extra revenue, he explained, will help the town maintain and enhance programming and start to make a stab at reducing the town’s unfunded pension liabilities.

We need to be innovators,” Leng said.

He said his budget proposal will put Hamden on a debt destruction plan that saves us money,” and not just on a debt diet,” as Governor Ned Lamont announced in his state budget proposal last month.

Cutting costs out of the budget, Leng explained, is more difficult than it may seem.

So often in the process,” he said, from people in this room, from around the table, and like many council members before you, including [myself], I hear why don’t we just cut the budget 5 – 10 percent?’”

That, he said, was not an option because it would simply be destructive,” especially for emergency management, public safety, and senior services.

He explained that together, medical, pension, and education costs make up 69 percent of the budget.

Leng recommended that the town fund the superintendent’s proposed $89,394,925 education budget, which is an increase of about 2 percent over last year’s BOE budget.

If one adds onto that 69 percent the cost of public works, Leng continued, that leaves only around 20 percent of the budget for everything else, which includes fire and police, among many other expenses. 

Investments For Future Savings

In his proposed budget, Leng included a number of changes that he said will help set the town up to put itself in a better financial position in the long run and also strengthen town programming.

There’s a can that’s reported being kicked down the road a lot,” he said, referring to the town’s unfunded pension liabilities, which come to around $450 million. I want to pick that can up and I want to crush it.”

In the 2019 – 2020 fiscal year, Leng said he hopes to pay the full 85 percent of the actuarially required contribution (ARC) that the state requires it pay into its pension fund this year as a result of the pension obligation bond the town took out in a few years ago.

Then, in the following year, he hopes to pay 100 percent of the ARC, and in the years after that ramp up payments to 110, 120, and 130 percent of the ARC in order to leverage the power of compounding.” Ramping up pension obligation payments, he said, could save the town $50-$100 million in the long run.

His budget would also establish a capital investment fund, with an initial investment of $100,000, into which the town will contribute annually so that there is a reserve of funding for large-scale capital projects so that the town would not need to borrow as much money.

In the medical budget line, which is the second’ highest item on the budget behind education, the mayor announced plans to move to Medicare supplements, more health-savings accounts, and an insurance buyout incentive that he said could save $500,000 to $1 million.

The budget also includes a number of areas of increased programming. These include:

• Adding three community police officers and two school resource officers.

• Expansion of community mentoring and youth programs.

• Increased training for the fire department and fully funded positions.

• Reintroducing Sunday library hours.

• Increases in hours for assistant building officials so that more building inspections can take place.

• Increasing in youth mental health funding.

• Increasing senior tax relief so that eligible seniors will not see an increase in taxes.

• Returning funding for library materials.

Council member Justin Farmer: Skeptical.

One council member, Justin Farmer, who represents part of southern Hamden, applauded Leng’s call in the address for more partnerships. He said he didn’t at first glance agree with the approach for tackling the pension problem.

There’s many ways to skin a cat. That’s not the way to do it,” Farmer said. We’re going to underfund the pension now and compound the interest over the next three to four years. I have multiple problems with that. I don’t know if I’m going to be here three to four years, let alone if the mayor is going to be here in three to four years. He talked about picking up the can and crushing to me; to me it looks like kicking it.”

Leng’s Address

Following is the text of Leng’s address Monday night:

Good Evening Honorable Members of the Legislative Council, friends, and residents, both here and at home.

I come before you to present the Mayor’s Recommended Budget for Fiscal Year 2019 – 2020. Over the next 2 months, as ordained by our Town Charter, the Legislative Council will deliberate and adopt our final Hamden budget. The proposal I present tonight builds on the progress Hamden has made in recent years, while weathering challenging financial times to stabilize our fiscal security and protect essential services our residents depend on.

Town budgets are not just about dollars, but also must focus on priorities and our values. In addition, it must seek to preserve and promote our long-term vitality, sustainability and resilience. Municipal budgets can’t just be about 12 months, more than ever they need to establish and be a key part of a multi-year plan designed to address the needs of now, while setting the table for the stronger and more affordable Hamden we seek to build for tomorrow.

There is constant pressure on Hamden’s mill rate, which I believe is too high, and the need to provide quality essential services. This pressure, without the ability to diversify our revenues from the regressive mill rate option the State dictates we solely use, creates strain on our residents and their wallets.

I wanted to deliver a budget tonight with a mill rate reduction or to hold the line on taxes. After many months and hundreds and hundreds of hours – I came to the conclusion that the best way forward was to ensure our services were not only protected, but even enhanced, to make investment into a clear plan to reduce our annual operating expenses moving into the future and to fund our obligations as best we could. I did this with a constant eye on minimizing spending wherever feasible, fighting to keep any increase small and reasonable. Some of you probably expected a no tax increase budget in an election year – what I am delivering is a small increase that will allow Hamden to start attacking expenses realistically and with innovation so that we can truly reduce expenses exponentially into the near and longer range future and reflect our values by focusing on safety, education and supporting our youth and seniors while making our hometown a more attractive place to live and in which to invest.

We have a responsibility to develop a budget that ensures that our children are educated, our medical and public emergencies are answered, our streets are safe and paved, and that we provide the type of programs and opportunities that bring positive change to our families and
communities. We have a responsibility to develop a budget that handles all of these goals, while remaining fair to our taxpayers and supporting an environment where families, young adults, and businesses want to invest.

Delivering on these goals has gone from difficult to nearly mystifying in an age of massively increased needs from our community and a more complex society and following two very difficult years where our revenue from Connecticut saw harsh reductions.

So often through the budget process, from people around this table and many who sat before you, including Councilman Curt Leng, the question or suggestions just cut across the board by 5% or 10%” is a common theme. In perceived moments of trouble, and without the context to understand the impact this has, short and long term, these suggestions of cuts may seem reasonable to the observer. In practical government, the concept is a whole lot more attractive than the destructive result it would deliver. I asked our DH’s to talk to me about what a conceptual 5 – 10% reduction to their budgets might look like and the result harmful to every Hamden resident and put our short and long term viability and quality of life to the test.

The results if you approached 10% reductions were nothing short of destructive, particularly for your emergency management, public safety and senior services.

So what does this mean to our future? Government leaders with hometown dedication and the level of experience that’s just an absolute requirement to get things done, must think about today’s needs, tomorrow’s need, and the needs of Hamden 2030 and beyond.

Big Picture” forward looking financial and management solutions are essential to answer the question of how will we be able to afford the level of services we provide and value. To present a plan that tangibly explains how we’re going to cover the expense increases that every Town faces as we move forward. Especially when we’re working hard to fix problems that have been created over many years and many decades.

The budget that my team and I have put together is responsible to our financial obligations and responsive to the needs of the community. Big picture proposals for the pension fund and the medical self-insurance fund, which now make up a combined staggering total cost of $72.570,000 – this represents just shy of 1/3 of our ENTIRE TOWN OF HAMDEN ANNUAL BUDGET.

I am recommending an education allocation that fully funds the Superintendent’s Requested Budget of $89,394,925, a reasonable 2% increase over the previous school year. I am doing this to reinforce the importance of investing in our youth and in education. Education, along with public safety, and protective community services are the most important functions our local government provides and the budget you see will reflect that.

So, if you take our pension and medical fixed costs and our education budget costs and add those three areas, it totals $161,964,925, or 69% of our annual Town budget.

Since becoming Mayor I have worked hard to invest in our infrastructure, paving roads, pouring sidewalks, investing in protecting our assets of our Town facilities such as the library roof replacement and senior center improvements. In addition, schools need essential and extensive renovation work. The capital improvements we cover with bonding, a very low interest form of borrowing and with grant funding opportunities. Our Public Works Department that handles everything from clearing our roads when it snows, to making our Town safe after a severe weather event, to beautification efforts and disposal efforts for your home of trash, recycling, leaves, brush and more, together total $20,559,199. Add these essential services with the obligations of education, medical insurance and pension and you total $182.5M or pushing 80% of our annual budget.

If you haven’t noticed already, we’ve spend nearly 80% of the Town budget and we do not have funding for fire safety, for emergency medical response, for our youth or senior programming, we haven’t covered the cost of the police officers that both prevent crime and work to make us safe, we haven’t funded the services that are essential to serving our youth from mentoring to recreation opportunities to after school programming, we have not paid for any Town program or concert, our zoning or health inspections, we haven’t funded our traffic division controlling our signage, intersections and traffic safety measures or our legal department working to protect the town and keep our costs down. The model is unsustainable to do all of these essential things with what is the equivalent of 20% of our Town’s annual operating budget.

So what do we do?

We need to be innovators.

This coming year we will:

 — Expand upon pension reform with three specific actions that will reduce our pension liabilities saving the Town tens of millions, if not up to $100 million dollars; one of these three ways is by taking the can that some have reported being kicked down the road, picking the can up and crushing it. This budget recommends a new plan for Hamden Pension Funding. We’ve ramped up in the past, and this has been extremely helpful, but we need to do more to control costs and REDUCE the cost of the pension expenses – I propose tonight that we not only fund this budget at the 85% total level required by the State of Connecticut, but that we ramp that payment up to 100% of ARC next year, and then leverage the power of compounding by funding the ARC at 110%, then 120% and then 130% of ARC, prepaying down our liability to what early estimates show could save the Town nearly $100M dollars. Pension problem solved and Hamden’s pension becomes one of its assets instead of a constant liability.

 — Medical – moving to Medicare supplements, additional HSA and a new insurance buy out incentive will save us millions.


 — This budget has a Capital Investment Fund which we will start with $100,000 funding and then with small increases per year we will grow a fund to pay for millions and millions of capital expenses, including schools without having to borrow, this along with

 — Our new hyper-focus on grants will put Hamden not only on a debt diet, but a debt destruction plan to save our Town and create a Hamden that has protected our services and cut our taxes to the envy of the communities around us.
 — What makes a strong budget, and therefore, a strong government? This budget proposes:

· Resiliency
· Stability
· Revitalization

In my time as Mayor, we’ve taken on some key projects and initiated or expanded key program with the genuine intent of improving life for residents and making Hamden a place that people want to move to, to invest in and to be a part of.
Two key components of these efforts are additional positive youth programs, anti-violence initiatives and an expansion of our community policing and safety measures.

This budget expands upon these areas, and it funds:

- A new YMCA after-school program;
 — Additional mentoring and youth anti-violence programming;
 — An expansion of our community policing and school resource officers and more

And all this with an eye toward cutting overtime expenses and increasing the level of and quality of services delivered.

So, how do we pay for it the starting points this year; with a responsible, but conservative .77 mill increase. This ¾ of a mill helps us cover our expenses and start laying the ground for a Hamden that we can all be so very proud of in the years to come.

This increase is not one I wanted to present, but it was the right thing to do and I am pleased to report that it will cost the median income homeowner $105 more to protect the services that keep Hamden clean, green, safe and helpful to our residents young and old.

In this budget proposal, we have worked to continue accomplishing these goals. I am also very pleased to announce that residents support by senior and veterans tax relief programs will remain covered. Our seniors and veterans form the backbone of our communities, and should be supported and recognized for the strength, wisdom and stability they provide to our lives, neighborhoods and relationships. As such, I am proposing an expansion to our Senior Tax program which will have the effect of shielding all 750+ seniors in the program from any tax increase.

Conclusion:

As I mentioned at the beginning of this address, the guiding principles of this budget proposal are stability, resilience, revitalization and our pension obligations. It is our duty and highest priority to maintain, support and enhance our community through quality core services and responsible financial management solutions.

I believe that this budget adheres to those principles.

This budget does not include any layoffs. It does, however, provide options for responsible medical and pension fund payments. It does preserve our services, and it does ensure our communities remain safe, our infrastructure remains intact, and that our families and children are well served by our Public School and Emergency Protective Services.
I am very pleased to submit a budget to the Council which nearly holds the line on taxes, proposing less than 1 mill of increases town-wide.

I look forwarding to engaging the public, the Council, and the media on the specifics of my proposal and will be hosting a number of community forums in the coming weeks to discuss Hamden’s financial stability, our overall financial position, and major plans and goals for the next fiscal year.

I offer my financial team and offer my assistance and cooperation with you in the weeks and months to come as you work on your budget process. You have a lot of work to do, I respect that and I thank you in advance for that service you will be providing our residents as you seek to help them protect their key services and quality of life. It’s no easy task, but this is what governing in the new millennia calls for and if you don’t have the desire to roll up your sleeves and the experience to make the right judgements than there is unfortunately the opportunity to put a lot of people and the Town’s stability at risk.

I know our best days lay ahead.

Thank you all for your time this evening, and May God Bless our Town.

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