Processing Your Payment

Please do not leave this page until complete. This can take a few moments.

April 16, 2018

Bailout balances Bronin's Hartford budget

Contributed photo Hartford Mayor Luke Bronin
By Matt Pilon

Hartford Mayor Luke Bronin’s proposed budget for the coming fiscal year will balance with few cuts thanks to a major long-term financial commitment from the state and renegotiated union contracts.

Bronin on Monday unveiled his fiscal year 2019 budget, which is his third as the city’s chief executive. He also announced on Monday that he will not pursue the Democratic nomination for governor.

Bronin’s $567 million spending plan, which city councilors will hold a hearing on late next week, contains no layoffs or one-time revenue-raising maneuvers like asset sales or pension cost shifting, and no new borrowing.

Hartford was facing a projected $63 million deficit in fiscal year 2019, but most of that was wiped out by an approximately $48 million debt assistance payment from the state -- provided through its recently created Municipal Accountability Review Board.

That assistance was part of a long-term bailout plan for the city, in which the state has agreed to pay off approximately $550 million in Hartford’s general obligation debt over the next two to three decades. With interest, the amount could be higher.

The bailout has become controversial among some state legislators and other politicians, even some Democrats, who have said they did not realize the size and scope of Hartford’s bailout when they agreed to helping the city last year.

Gov. Dannel P. Malloy defended the bailout plan on Friday following a meeting of the Bond Commission.

Bronin’s budget also includes about $10 million in labor savings achieved through previous contract negotiations with most of the city’s major worker unions, as well as $2.3 million in overtime cuts and health savings.

The city also hopes to receive the first $10 million installment of a donation from major insurance companies in fiscal year 2019.

The city was facing a $37 million deficit in the current fiscal year, which ends June 30, but expects its assistance agreement has already covered about one-third of the shortfall, and the city plans to ask the MARB to cover the remainder.

The agreement with the state, which allowed Hartford to avert a Ch. 9 municipal bankruptcy filing, has led to bond rating agencies looking more favorably upon the city. Earlier this month, Moody’s upgraded the city’s debt rating by 13 notches, to ‘A2,’ while on Monday, S&P upgraded Hartford from ‘CCC’ to ‘A.’

Bronin’s administration has eliminated approximately 100 jobs over the past two years through layoffs and attrition. His proposed budget would keep current staffing levels flat, and would also maintain level funding for the Hartford Public Library, homeless shelters and a summer employment program for city youth.

Funding cuts for various cultural events and parades would remain in effect.

The proposal would also fund two zoning enforcement positions (the city currently has none) and the launch of a residential rental licensing program.

In a statement, Bronin said the state's long-term assistance must come with long-term reliability. The MARB will have a say over the ultimate approval of his budget.

"While we are now in a position to achieve stability, it is important to say clearly that our budgets will remain very tight," Bronin said. Our mill rate will not be coming down any time soon. While we will work diligently to rebuild our [rainy day fund], reaching appropriate levels of fund balance will take years."

Sign up for Enews

Most Recent

Most Recent

0 Comments

Order a PDF