BERLIN - Voters are being asked to approve a proposed $43.9 million school budget and $45.6 million general government budget for fiscal year 2018-99 that includes a proposed 5.01 percent tax increase.
The move to send the budgets to referendum came after an alternative general government budget that would lower the increase but add more debt failed to gain the nine votes needed to pass on Monday.
The Town Council and Board of Finance had eight votes for the alternative proposal, four against and one abstention, in the joint meeting held after the council last week rejected the Board of Finance crafted budgets with the same figures as the ones now going to referendum.
“I don’t feel like with this budget we’ve done our job,” said Republican Mayor Mark Kaczynski, as he and three fellow Republican councilors voted against it Monday night. They were advocating for a lower tax increase, they said.
Republican finance board member Sal Bordonaro was the one abstention, as the three Democratic councilors and remaining finance board members with two Republicans, two Democrats and one independent voted for the alternative plan.
The meeting on Monday was forced, under a Town Charter provision, after the Town Council voted to reject the budget last Wednesday, with an unofficial plan to move $1.1 million of $2.2 million in capital items to short-term borrowing as a way to lessen the tax burden on residents. The items include replacement plow trucks, police vehicles, safety communication equipment at the schools and other infrastructure improvements.
The bond idea was proposed by Kaczynski last Wednesday and informally agreed upon by all members of the council and four members of the finance board, after the two panels discussed the idea in a recess session during the meeting.
The bonds would have lowered the proposed tax increase from 5.2 percent to 3.7 percent, or from $292 on a house valued at $250,000 to $204.
Once looking at the numbers on the bonding idea, which would’ve had the town pay $60,000 in interest next year and about $400,000 in principal and interest payments in each of the following three years, the finance board proposed moving a couple of items to bonding.
Those being funds for proactive bridge repairs and emergency road maintenance funds budgeted in anticipation of no state aid. The two totaled $341,000 and would have been included in the $1.5 million planned to be bonded for road repairs, with the actual road repairs being paid with the remaining funds.
“It’s not solving the problems,” said Republican Finance Board Chairman Sam Lomaglio during the Monday meeting on the bonding idea by Kaczynski. He said next year’s budgets would be made “ugly” by having the town tie itself into more debt payments.
“I don’t want to continue down the path of just constantly swiping the credit card,” said Republican finance board member Kevin Guite, who was not at the council meeting last week.
He shared, by his own research, Berlin had a low tax rate dating back to 2013-14, compared to neighboring towns of Southington, Cromwell, Plainville, Rocky Hill and Newington, meaning the town wasn’t investing in itself as other municipalities had.
This year’s capital funding was $98,000.
Kaczynski said the low rate had made the town appealing to new businesses.
Bordonaro said during the meeting he thought the bonding idea was a good compromise and he had heard from residents who were concerned with the tax increase. He told The Herald Tuesday he couldn’t bring himself to vote either way on the budget since the agreement made between the council and finance board last week wasn’t being honored.
Finance Director Kevin Delaney said the general government alternative would have been favored over the bonding capital idea by rating agencies as it didn’t ignore the capital and debt policies the town adopted last year. It would have also been a reactive, not proactive move, he added. Last week he said it would not be prudent to bond the capital items.
As a result of grand list growth being larger than anticipated after assessment appeals hearing, the needed revenue from taxes to make up the difference isn’t as great.
The proposed new tax rate was adjusted to 33.21 mills, from 33.28 mills when the finance board sent the budget to the council. Two assessment appeals are in the process of going to court and could change the tax rate again, Delaney said. The current tax rate is 31.61 mills.
The referendum is on April 24 and will take place at all regular polling places. If the budget fails, it is sent back to the Board of Finance to start the process all over, leading to a second referendum.
This is the first year the schools and general government budgets are voted on separately. They can be found on the Finance Department page of the town’s website, town.berlin.ct.us.
Charles Paullin can be reached at 860-801-5074 or firstname.lastname@example.org.