Updated, 8:23 a.m.: Copy edits, revised headline
NORWALK, Conn. — Norwalk Common Council members on Tuesday set a budget cap of $367.6 million, sending their plan to draw down $6 million in “Rainy Day Funds” Norwalk’s tax Board.
One Council member voted against the budget, while others defended the use of the fund balance. One citizen took the time to voice opposition – unaffiliated Mayoral candidate Lisa Brinton questioned the motives of using Rainy Day money in this, an election year, and Mayor Harry Rilling in response pointed out that no Rainy Day Funds were used ahead of the last municipal election.
Rilling presented historical information, showing that a fund balance draw down has been factored into Norwalk’s budget for seven of the last eight years. Brinton also presented data, including the meteoric rise of the percentage of Norwalk Public Schools’ students who are eligible for free or reduced lunch prices.
The $367,624,642 budget cap represents $351,020,744 in expenditures from local tax dollars and $16,603,968 from estimated intergovernmental grants. The $6 million fund balance drawdown is planned to fund $2.3 million of Board of Education one-time expenses and $3.7 million of City-side expenditures. This represents a 4.2 percent increase in the Norwalk Public Schools budget.
Brinton said she was inspired to attend by NancyOnNorwalk’s Tuesday story, reporting on poor attendance at a operating budget public hearing and quoting Majority Leader John Kydes (D-District C) as saying it was “a fiscal director’s dream: $6 million in the Rainy Day Fund and nobody here.”
“Less and less of our income tax dollars are getting returned to our city each year from Hartford and that trend is set to continue. If teacher pensions come back to the municipalities, I fear we’re going to be seeing even more for sale signs in town,” Brinton said, commenting that she was “waiving the yellow caution flag” over “fuzzy math.”
“We have a 3.3 percent increase in the city budget but somehow we’re drawing down $6 million or 10 percent of the Rainy Day fund? How is that if, when recently Mr. Mayor you stated that the grand list grew by 16 percent? It just doesn’t add up,” she said.
“I know it is an election year, so perhaps that’s why we are choosing to use the Rainy Day fund,” Brinton said, offering this look of Rilling’s time in office:
- The student population has grown by 500 children
- The free and reduced lunch rate has grown from 47 percent to 57 percent
In 2004-05 the free and reduced lunch rate was 23 percent, she said.
“With these trends and a questionable property revaluation, the need to use the Rainy Day fund for operating expenses, and the potential policies that are coming down the pike out of Hartford, I ask you, ‘Are these budget and land use policy practices sustainable? Are they integrated?’ Think about it,” she concluded.
The goal is to keep tax rates as low as possible while still maintaining services, Finance Committee Chairman Greg Burnett (D-At Large) said, observing that most Norwalkers will see lower tax bills under the proposed budget.
“I have realized that the majority of the public basically doesn’t understand the budget process,” Kydes said, explaining that with the state’s minimum budget requirement, the City cannot cut the total funding for the Board of Education.
“Undoubtedly, (Norwalk has had) the largest Board of Education increase in the state for the third year in a row. which I am proud to be a part of,” Kydes said. He went on to issue what he called a “personal” message to the Board: “This may not be an option next year so please spend the money that you are getting this year wisely.”
The BoE has “made great progress and I am proud to be able to support them in their efforts going forward. I am also hopeful that this agreement is a model of cooperation going forward,” Council President Tom Livingston (D-District E) said.
The Common Council will attend the annual BoE retreat this summer, for the first time, to discuss the 2020-21 operating budget, Livingston said.
“Sometimes we just disagree about approaches about fund balance,” Council member Doug Hempstead (R-District D) said, explaining that he’s advocated using the fund balance before but that was during the height of the 2008 recession, “the right time to use an emergency fund.”
“It is called out a one-time expenditure for the Board of Education but we all know, the way the budget works, the state of Connecticut law works, that that money once given to them becomes their baseline for next year’s ask,” Hempstead said.
Norwalk Public Schools Chief Financial Officer Thomas Hamilton has repeatedly said that the NPS budget will go up $3.2 million next year, regardless.
Fund balance money should be used to pave roads, build sidewalks or deal with new school construction cost overruns, Hempstead said.
“The budget process has been calm for the last few years because we’ve had enough funding to go over that,” Hempstead said. “My problem is at some point the lines intersect, where you’re having falling revenues and falling fund balance, and rising tax rates and rising costs to the City of Norwalk and it won’t be the ability to draw down that fund balance.”
Hempstead voted no. Darlene Young (D-District B) and John Igneri (D-District E) were absent.
Rilling fires back
“It’s unfortunate sometimes when people would ascribe evil intentions or ill-intentions to certain things,” Rilling said. “During an election year, in 2017, there was a zero drawdown on our fund balance. That was an election year and the fund balance represented 12.5 percent of our operating budget.”
The Council in February 2017 planned a $3 million drawdown from the fund balance; the Board of Estimate and Taxation nixed that as the state legislature struggled well into the fall to approve a budget.
Rilling on Tuesday offered these statistics:
- In 2012-13, $1 million was budgeted to be drawn from the fund balance, when the fund balance was 9.5 percent of operating budget
- In 2013-14, $1.7 million was budgeted to be drawn from the fund balance, when the fund balance was 9.4 percent of operating budget
- In 2014-15, $1 million was budgeted to be drawn from the fund balance, when the fund balance was 10 percent of operating budget
- In 2015-16, $1 million was budgeted to be drawn from the fund balance, when the fund balance was 9.3 percent of operating budget
- In 2016-17, $2 million was budgeted to be drawn from the fund balance, when the fund balance was 10.9 percent of operating budget
- In 2017-18, nothing was budgeted to be drawn from the fund balance, out of concerns for state funding instability
- In 2018-19, $2.95 million was budgeted to be drawn from the fund balance, when the fund balance was 11.8 percent of operating budget
- In 2019-20, $6 million was budgeted to be drawn from the fund balance, when the fund balance was 12.7 percent of operating budget
In spite of the planned drawdowns, each year the fund balance grew by the following amounts, he said:
- 2012-13: $2.8 million
- 2013-14: $4 million
- 2014-15: $7.3 million
- 2015-16: $6.3 million
- 2016-17: $4.5 million
- 2017-18: $5.6 million
Hamilton has said he expects the fund balance to grow this year, as well.
Norwalk’s department heads are “very judicial in their spending,” Rilling said, adding that he meets monthly with Norwalk Superintendent of Schools Steven Adamowski to discuss issues and the pair are talking about combining some administrative functions to reduce costs, perhaps in IT (Information Technology) and Finance.
“We are doing a lot … and I believe this budget is a fair budget,” Rilling said. “During a reval year, it is very difficult to look at some of the valuations that are coming out and explain to people how in 2013, your property values went down based on the recession, and now in 2018 those property valuations are going up in some cases 20 and 30 percent.”
“I have always said, the fund balance, the money in our fund balance, belongs to the taxpayers,” Rilling said. “When we can, take money out of the fund balance in order to give some tax relief. Over 90 percent of our budget is paid for by the taxpayers so when we can give them some sort of tax relief, I applaud that.”