Awaiting a state budget, local officials anxious at governor's new plan

The Connecticut state flag flies upside-down in response to the state's budget problems on Friday, Aug. 18, 2017, at North Stonington Town Hall. (Sarah Gordon/The Day)
The Connecticut state flag flies upside-down in response to the state's budget problems on Friday, Aug. 18, 2017, at North Stonington Town Hall. (Sarah Gordon/The Day)

In the continued absence of a two-year budget for the state, Gov. Dannel Malloy has revised his original resource allocation plan from June 30, shifting more state dollars to poorer school districts and to nonprofits.

His new executive order, released Friday morning, includes $557 million in cuts to Education Cost Sharing funding for Connecticut's 169 cities and towns, while the June 30 plan laid out $506 million in cuts.

This will "be the basis for state spending for Fiscal Year 2018 in the unlikely event that a state budget is not enacted," according to the governor's office.

ECS funds go out to municipalities in October, January and April, and local education officials are hopeful the General Assembly will pass a budget before October.

"In the absence of an adopted budget from the General Assembly, my administration is reallocating resources to pay for basic human services, education in our most challenged school districts, and the basic operation of government," Malloy said in a news release. "The municipal aid that is funded as part of this executive order reflects the nearly impossible decisions Connecticut must make in the absence of a budget."

Across the state, 30 districts are maintaining ECS funding from last year, 54 are losing some funding and 85 will receive no ECS grant. In southeastern Connecticut, the revised plan has New London and Norwich maintaining the same funding as last year, while every other municipality is losing some or all its ECS money.

Groton would be hit the hardest: The June 30 plan had the district losing $16.57 million from last year, while the new executive order lays out a $17.53 million cut.

"I am 100 percent confident that these numbers obviously will be adjusted, and a budget will reflect much better, much larger resources to the towns," Superintendent Michael Graner said.

Senate President Pro Tem Martin Looney, D-New Haven, said Senate Democrats intend to caucus next week.

"While we appreciate the Governor's focus on our neediest municipalities, his proposed cuts would have a devastating effect on many school districts across Connecticut," Looney said in a statement. "Democrats in the Senate are dedicated to Connecticut's great public education system and have been diligently working on a plan that will save school districts from the vast majority of these cuts."

While Graner is confident the legislature will come together in the next few weeks, he said that "if these cuts were implemented, basically, the school system as we know it would no longer exist. We would have to basically dismantle elementary, middle, high school education as is currently being configured."

The Groton budget accounted for a $5 million ECS cut. Referring to the remaining hole, Graner said sarcastically, "What's $12 million among friends?"

Sen. Heather Somers, R-Groton, said in a statement there's no explanation for cuts this deep. She attributed the cuts to "a failed administration and a failed Democrat majority."

Rep. Christine Conley, a Democrat representing Groton and Ledyard, said in a news release that she will be fighting Malloy's revised plan because of the substantial cuts to her two towns.

"These cuts are absolutely unacceptable," she said. "Groton and Ledyard schools will not be able to function with these significant cuts and our children will be the ones to ultimately pay the price."

But Conley stressed that these numbers are not permanent and urged other legislators to act with a sense of urgency.

The new executive order has Ledyard losing $5.99 million in ECS funding, an exact cut in half from last year's funding.

Ledyard Mayor Fred Allyn III called the executive order unfair and disheartening. He said the town's operations have become leaner and leaner as the state budget situation has gotten worse, and he felt that the state government hasn't made the right financial decisions in response.

"We're in survival mode," he said.

"This would bankrupt our town," North Stonington Superintendent Peter Nero said, factoring in other non-ECS cuts to his town under the executive order. He said, "There's nowhere we can squeeze the staff."

In protest of the state's inability to pass a budget, North Stonington First Selectman Shawn Murphy flew the state flag upside down at Town Hall, an action commonly used to signal distress.

"This is ridiculous," he said. "We can't run a town with uncertainty: We'd be better off not sending any money to the state because they're mismanaging the money we send them."

Another town being hit hard is East Lyme, which has been marked to lose its entire $6.92 million ECS grant in both executive orders.

"It's unfathomable," Superintendent Jeffrey Newton said. "You can't make a cut as drastic as that to a district." He noted that cuts in the millions means cutting staff and raising taxes.

Newton said the district — like many others — is taking a wait-and-see approach to the budget, "because we're not going to take drastic measures and then have something change."

The loss in ECS funding to Salem would be $2.13 million, a 70 percent decrease from last year.

First Selectman Kevin Lyden called the cuts "simply outrageous," saying, "We've been fiscally responsible in our town, so because we've done that we're going to be penalized."

For Norwich, the governor's revised plan had ECS funding at $36.21 million, the same as last year. Superintendent Abby Dolliver's first reaction was, "Thank goodness," considering the June 30 executive order had the district losing more than $1 million.

But Dolliver and business administrator Athena Nagel remain confused about special education funding from the state.

The governor's office said it is "holding harmless" the state's 30 Alliance Districts, which includes Norwich and New London, by not cutting ECS funds from Fiscal Year 2017 levels. Alliance Districts are the state's lowest-performing districts.

But Dolliver is concerned that Alliance funding will have to go to special education.

This is because allocating the Special Education Cost Sharing Grant at Fiscal Year 2017 levels was one of the changes made to restore $40 million to nonprofit health and human service providers and $60 million for other expenditures.

Like Dolliver, New London Superintendent Manuel Rivera said he doesn't know if there will be sufficient revenue from the state for special education.

The school finance director, Rob Funk, said governor's executive order "funds our ECS back to what it was in 2017, which would be an increase over what our budget was based on for ECS, but it's a drastic decrease for what our budget was in special education."

Senate Republican President Pro Tem Len Fasano, R-North Haven, asserted that Malloy is violating the law by reducing special education funding.

He said in a statement that Malloy "mistakes the governorship for a dictatorship" and that his executive order "exacerbates the very same education funding system deemed unconstitutional by the Connecticut Superior Court."

Hartford Superior Court Judge Thomas G. Moukawsher ruled that the state's method of distributing education aid violates the state Constitution, the Connecticut Mirror reported, and the state Supreme Court is scheduled to hear an appeal on Sept. 28.

Kelly Donnelly, communications director for Malloy, shot back in a statement about Fasano's comments, "He should spend less time writing letters and press releases and more time working to build consensus around a budget."

Day Staff Writers Nate Lynch and Amanda Hutchinson contributed to this report.

Proposed ECS funding for FY2018


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