In Light of Malloy’s ‘Plan B,’ Board of Finance Delays Budget Decision

The Board of Finance expected to leave its budget workshop Wednesday night with a proposed 2011-12 spending package for the town.

But because the furor over Gov. Dannel P. Malloy’s ‘Plan B’ budget earlier in the day, however, board members put off the decision.

The ‘Plan B’ state budget, released Wednesday as an alternative proposal if state employee unions don’t make $1 billion in concessions, would drastically cut municipal aid to towns, including $1.3 million for Canton. That would be more than a third of the $3.7 million it is due to receive.

“The potential impact is so severe you can’t really plan responsibly,” said finance board member Brian First.

The town is accustomed to setting a budget before the state finalizes its budget.

Generally, however, officials are able to reasonably estimate the town’s revenue stream, including the portion expected from the state, finance board Chairman Richard Ohanesian said.

“In most budget years of the past that had some predictability,” Ohanesian said.

Early in the meeting, First Selectman Richard Barlow gave some input on what members of the Connecticut Conference of Municipalities thought of Plan B at a meeting in Hartford on Wednesday.

“No one wanted to take it seriously – it’s so dire,” he said.

When the Board of Finance began discussing the idea of putting off a decision until next month, Barlow said that the state legislature would likely not be any closer to taking action on the state budget at that time.

“I could see us past July without a resolution on the budget,” he said.

Finance board members agreed but said a delay would at least give them a chance to digest the information and perhaps get a sense of what might happen.

“If we tried to make a decision on what we know today, it would be futile,” member Richard Eickenhorst said.

The finance board pushed back its budget workshop until May 9 at 3:30 p.m. and the annual budget meeting to May 26. A budget can be approved at town meeting but will go to referendum if fewer than 150 qualified voters are at the meeting or if that same number of people petition for one.

As proposed, the town’s plans total $34,395,768, a 2.2 percent increase from the current fiscal year.

The Board of Education’s proposal is $22,904,566, a 2.8 percent increase from the current spending plan of $22,283,809.  

The Board of Selectmen’s proposed budget is $9,314,852, a 2.5 percent increase from the current adjusted budget of $9,085,283.

Debt Service is slated at $2,071,000, a 6.6 percent decrease. The Board of Finance Budget approved its own budget, which covers such items as the budget mailer, recording clerk for meetings and the town audit, at $105,350, down 9.5 percent.

The town pays for its budget through revenue, which includes local taxes, state and federal aid and grants. If the revenue at the current rate of taxation does not cover the proposed budget, the finance board can make up the difference by raising taxes, reducing spending or a mix of those actions.

Before the potential ‘Plan B’ scenario, the board said there was a $579,036 “gap” in paying for the budget expenditures as proposed and if the numbers remained unchanged, the tax rate would go from 26.09 mills to 26.62 mills, for a 2.03 percent increase. Owners of a house with a market value of $361,429 and an assessed value of $253,000 would have to pay an additional $134 in taxes.

If the governor’s Plan B were enacted and town spending levels remained unchanged, finance board members said the tax increase would be more like 6 percent this year and even more next year.

Reached later Wednesday evening about the finance board’s delay in action, David Bednarz, deputy press secretary for Malloy said, “We understand their concern.  It’s why the governor is working so hard to get an honest, responsible new budget in place as soon as possible.”

Board of Education Chairwoman Beth Kandrysawtz said she expected the finance board to delay a decision after hearing the news Wednesday.

“It’s difficult but I think they’ve done the responsible thing,” she said.

Barlow said he agreed it was prudent but still feels there will be no significant “action out of Hartford” in the next several weeks.

Barlow said the Board of Selectmen will also have to discuss the charter revision referendum it set for May 17, anticipating that a budget referendum would be held the same day.