On September18, New London voters will get a chance to either approve or reject our municipal budget.
Previous budgets have gone to referendum so often that it’s almost routine. But this time it’s different. This year's budget referendum matters more than the 2010 referendum on charter revision, more than last year’s mayoral election. I believe it’s the most important decision New Londoners will make for generations.
What’s at stake? Solvency, for one. Last year we ran a four million dollar deficit and emptied our fund balance to cover expenses. This year, with no financial reserves, we have to raise enough cover expenses--and we're already falling behind. Our most recent tax bills went out at last year’s rate, yet our current spending requires a 7.5% tax increase. If we go bankrupt and require a state takeover, investors will back away, we’ll lose our autonomy, and the state could impose a tax increase which would make 7.5% seem like chump change.
Services we take for granted are also at stake. If voters reject the budget, likely cuts include reducing residential trash pickup to once every two weeks; closing the senior center; discontinuing youth and bilingual services, decimating Parks and Recreation; slashing funding for the library and deferring maintenance of our aging municipal vehicles. We could lose the ability to fix computer crashes outside of normal business hours, potentially affecting public safety. On top of all this, our bond rating would almost assuredly drop, making it more difficult to tackle larger projects or handle emergencies.
Most of us don’t want cuts to come from these areas. However, there aren’t enough other places to cut to appreciably lower the mill rate. We’ve already consolidated positions, laid people off, reduced salaries, left vacancies open, negotiated union concessions, ended comp time and reduced the number of fire trucks sent out on ambulance calls. We have thirty one fewer employees now than we had last year.
So why is there a tax increase after so many cuts? Three reasons: loss of state revenue, increased costs for debt service and insurance premiums, and the need to budget more accurately than in the past because we’ve exhausted the fund balance.
After years of flat taxes, there’s no question that a sudden increase will be difficult for many. Household budgets are stretched as tightly as municipal budgets, and some people will vote against any tax increase because they have nothing left to give. Yet a 0%—or even a 2%—tax increase is literally impossible. We wouldn’t be able to meet our legal obligations. A 5% increase would gut nearly everything that could be gutted. Even at the current increase, residents will feel the cuts, especially if it’s a snowy winter.
Fortunately there is a light at the end of New London’s financial tunnel. In 2014, several major tax abatements will end, bringing us over three million dollars in annual revenue. Other revenue-generating projects are in the works. Provided we pass the budget, our future is looking brighter than it’s looked in years. It would be heartbreaking to derail it now.
The September 18th budget referendum isn’t about the Mayor, it isn’t about Democrats vs. Republicans, and it isn’t about renters vs. homeowners. It’s about all of us coming together to save our services, our solvency and our city.
We have to pass this budget. Vote Yes on September 18.