Towns, cities to get more state aid next year

Local towns and cities will see more money than expected from the state next year.

The bipartisan state budget passed by the legislature late Wednesday restores funding to municipalities and calls for $70.5 million in increased state aid to towns and cities next year than in the current fiscal year, according to a statement from Sen. Paul Formica, R-East Lyme, co-chairman of the Appropriations Committee.

The spending plan approved Wednesday also calls for no new taxes and "fully funds" Education Cost Sharing grants for next year, the Special Transportation Fund, and the Renters' Rebate program, among other provisions, according to Formica.

In closing remarks late Wednesday, Gov. Dannel P. Malloy said he will fully review the budget in the coming days, but applauded the legislators' work.

Local officials, who were also reviewing the budget on Thursday, welcomed the news, with some saying they still need to determine how exactly the additional revenue would impact their communities, as they work toward approving their own 2018-19 budgets.

"The process this year is a welcome relief when compared to the uncertainty in last year's process," said Groton Town Manager John Burt.

Burt said the budget results in an additional $38,315 for the Town of Groton. Groton Public Schools will especially benefit, with an increase in the Educational Cost Sharing of $141,949 and an increase of Adult Education of $2,571, he said.

"I'm glad that they did pass a state budget, of course, and I'm glad that they did it in a timely manner and they didn't decimate the municipal revenues," including ECS, said Old Lyme First Selectwoman Bonnie Reemsnyder.

Old Lyme's Education Cost Sharing grant has been shrinking over the past few years and the governor had recommended cutting Old Lyme's grant entirely for next year. The budget passed by the legislature means the town will receive $241,512 in educational funding next year. The town did not plan for any educational funding in its spending plan for next year, which will go before voters at a town meeting on May 21.

"It just means hopefully we'll have a little bit of a surplus," she said.

Mayor Ron McDaniel said the approved state budget injects an added $1.5 million in ECS funding for Montville. He initially budgeted $11.1 million but according to the Connecticut Conference of Municipalities the town will receive $12.6 million.

McDaniel said it remains to be seen how the added funding could impact the school budget, which remains under review by the town’s Finance Committee before the Town Council takes a final vote on the budget May 23.

By delaying required expenses such as liability insurance and workers’ compensation until 2018-19, the Board of Education in December trimmed its 2017-18 budget by about $1 million due to midyear state cuts. The Finance Committee has asked the school board to provide a detailed breakdown of the delayed expenditures at a meeting at the high school Tuesday at 4 p.m.

McDaniel said he wished the state had included added funding in the Pequot-Mohegan Grant for host communities. Based on the adopted budget, Montville will receive a $6,300 reduction compared to this year.

The new state budget means mixed results for taxpayers in Norwich, and especially helps property owners in the central city paid fire district. Overall, Norwich expects to receive $93,251 in additional general fund municipal aid, mostly through increases in payment in lieu of taxes for state owned property, hospitals and colleges and a small, $7,944 increase in the municipal stabilization grant.

The budget set the state motor vehicle tax cap at 45 mills and the new budget greatly increased the reimbursement for cities and towns above that rate.

Because Norwich's central city paid fire district proposed tax rate is 49.65 mills in the preliminary budget approved by the City Council Monday, 4.65 mills above the cap, Norwich would receive $623,634 in reimbursement from the state for the difference.

City Comptroller Josh Pothier said with the new revenues, the proposed tax rate in the central city paid fire district would drop to 48.54 mills, a 0.2-mill drop from this year's budget and a 0.11-mill drop from the council's adopted 2018-19 budget. Taxpayers in the five volunteer fire tax districts would have tax rates of 41.16 mills, a 0.04 drop from the council's proposed budget and a 0.49-mill increase over this year's rate.

Unlike many towns in the region, Norwich saw no change in the $32.3 million ECS grant, but as a state designated Alliance District, Norwich would not have lost any ECS funding in an earlier proposed state budget.

North Stonington First Selectman Mike Urgo said the town is now anticipating an additional $263,000 in revenue from the state. Although the town has already put forth its budget, it is going to use that new information to help determine the tax rate next year.

The Board of Selectmen and Board of Finance plan on analyzing the data and providing updates at the town meeting on May 21.

“It’s good news for North Stonington and Connecticut as a whole,” said Urgo, who added he was thankful to state Sen. Heather Somers and state Rep. Diana Urban for their work on behalf of the town.

East Lyme First Selectman Mark Nickerson said the town had originally anticipated it would receive a decrease in state aid next year, based on the governor's cuts. Under the legislature's budget, the town will now see a $331,000 increase in state aid compared to the current year's allocation.

"We're thrilled that we're being restored some of the money that is owed to us," Nickerson said.

The East Lyme Board of Finance will have options such as applying the extra revenue to the calculation of next year's tax rate or putting it into the fund balance, he said.

Lyme is getting approximately $50,000 more in state aid than it had budgeted. First Selectman Steven Mattson cautioned that the state can always later revise the funding it now says it will provide muncipalities, but he said that assuming the town does receive the money, it will serve as additional revenue to the general fund balance.

"We're very happy to see the legislature is continuing to provide some funding to towns," he said. Though Lyme receives a small amount of funding from the state, he said "every little bit does help."

In Waterford, First Selectman Dan Steward said the budget restored payments-in-lieu-of-taxes totaling about $250,000 for several state-owned properties in town, including Seaside and Harkness Memorial State Park. Waterford also stands to receive about $70,000 more than expected in ECS funding, for a total of $320,000, Steward said.

"These are still somewhat tentative. They're calling it preliminary estimates," Steward said. "But it's better news than we expected."

No immediate information was available about funding for Ledyard, Salem, Stonington and New London.   

Staff reporters Claire Bessette, Charles Clark, Deborah Straszheim, and Benjamin Kail contributed to this report. 

k.drelich@theday.com

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