New London mayor proposes budget with modest increase and projected drop to tax rate
New London — New London Mayor Michael Passero on Wednesday presented the City Council with a proposed $94.9 million budget, a 1.48% increase over the current budget that, if passed, would lower the city’s tax rate.
The overall budget increase of $1.38 million is distributed equally between the $50.7 million general government budget and $44.2 million education budget.
“The budget is largely the product of economic conditions that existed prior to unprecedented and still emergent consequences of the global novel coronavirus pandemic on our country, our state and our city,” Passero told councilors during a special meeting held via teleconference.
The budget, he said, reflects a “continued emphasis on lean spending to minimize year-over-year growth in expenses.”
“This philosophy has allowed us to continue the goal of walking back the mill rate while maintaining the city’s economic expansion and enhanced quality of life initiatives,” he said.
Details of the budget are available on the city’s website, newlondonct.org.
Finance Director David McBride said revenue has outpaced spending and led to an increase in the fund balance, from $11 million last year to a projected $15 million, or 16% of the general fund operating budget. Under the proposal, the mill rate would drop by 4.5%, from 39.99 to 38.19 mills, in part due to a 2.85 % increase in the city's grand list of taxable properties, which translates into more tax revenue.
Passero, in his address to the council, said all of the previous four budgets have resulted in either an increase in the fund balance, a drop in the mill rate or both.
The $50.7 million general government budget, a 1.49% increase from the current budget, would require an additional $743,860 from taxpayers. Increases include a $702,000 jump in the current $11.56 million police budget, which McBride said is largely driven by contractual and health care increases. The public works budget would rise by $479,000 to $7.9 million and fire department by $320,000 to $9.3 million.
The $44.2 million education budget, which includes an estimated $22.48 million coming from state educational cost sharing grant funds, would require $21.7 million from taxpayers, an increase of $639,000. Under the mayor’s proposal, educational spending would increase by 1.47% but fall short of the $44.78 million requested by the Board of Education in its proposed $72.1 million overall budget. McBride said the taxpayer-funded portion of the mayor’s education budget request is a 3% increase.
City Council President Efrain Dominguez said the public participation portion of budget discussions starts next Tuesday, when the council begins a series of meetings with department heads to delve deeper into the specifics of the budget.
The city has yet to experience any significant financial impact from the coronavirus public health crisis and Passero said he hoped any impact would be short-lived.
“However, if this pandemic results in unanticipated losses in revenue, be assured all appropriate measures will be taken to mitigate any potential financial ramifications to the city,” Passero said.
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