News Junkie: Experts say Governor’s budget proposal would hurt housing market

HARTFORD, Conn. — A Connecticut economist and a real estate agent say Connecticut’s budget stalemate — and the proposals being put forth to resolve the budget deficit — would hurt the housing market.

Gov. Dannel P. Malloy’s revised executive order, which would go into effect if the General Assembly fails to pass a budget in the next few weeks, eliminates state education funding, also known as the Education Cost Sharing grant, for 85 Connecticut towns and reduces funding to an additional 54 communities. It restores to funding at 2017 levels for Connecticut’s 30 lowest-performing school districts, including Hartford, Bridgeport, Waterbury, and New Haven.

Meanwhile, Malloy’s original budget asks cities and towns to contribute to teacher retirement costs, which, according to municipalities, would force them to increase property taxes. Moody’s Investor Services recently reported that the ability of municipalities to use budget reserves is a challenge in Connecticut because the median rainy day funds for cities and towns is 13 percent, which is lower than the national median of 31 percent.

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