CCM applauds Appropriations Committee increase in aid; looks to General Assembly to build on aid increase, as towns struggle

CCM applauds the Appropriations Committee for a FY 2008-09 budget that includes $46 million in increases in aid for towns and cities over what had been proposed by Governor Rell in February ($26 million above the previously adopted budget).

However, the $46 million increase is not the significant boost needed to keep property tax rates in check and municipal services in place. CCM hopes that the General Assembly can (1) build on these increases by the time the state legislature adjourns on May 7, as well as (2) make permanent the present rates of the municipal real estate conveyance tax, which is worth nearly $40 million to towns statewide, but are due to sunset on June 30, 2008.

The hikes approved by the Appropriations Committee are as follows:

Program	Increase over Governor
Education
Priority School Districts – Early Reading Success	$19.7 million
Transitional School Districts	$ 3.0 million
Special Ed Excess Cost – Student Based	3.5 million
Non-Education
PILOT – Private Colleges and Hospitals	$ 6.2 million
PILOT – State Property	$ 5.0 million
Pequot-Mohegan Fund	$ 1.4 million
DECD – Tax Abatement	$ 1.7 million

In addition, the Appropriations Committee budget also provides funding for certain programs that are not formula grants, for example: new Urban Grants for Lower Priority Policing ($1 million), Vocational Agriculture ($1 million increase over Governor), and several grants that are below $1 million each.

But the proposed budget makes no change in the Governor’s proposals for funding the Education Cost Sharing (ECS) and Town Aid Roads (TAR) grant programs. And lastly, the Appropriations Committee budget would eliminate the Governor’s proposed $500,000 “municipal efficiency study” grants.

Towns and cities, in the midst of their own budget-approval processes, are staring down a gun barrel of big municipal tax hikes, service cuts, and employee layoffs – none of which will be good for CT residents and businesses. The costs of local government in communities continue to rise – for education, salaries, insurance, energy and more. Without adequate increases in state aid municipalities will have to raise property taxes, cut services or both. Personnel lay-offs remain a real possibility. Inadequate state aid will result in tax increases – municipal tax increases. It would be a tax transfer from the State to local governments.