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Kimmel: Both sides miss the mark on budget

By Bruce Kimmel (D-District D)

Common Councilman

NORWALK, Conn. – Sometimes you just can’t win, especially during a municipal election year. Reading some of the contributions to the local media, one might conclude that the city is spending too much and has saddled taxpayers with a heavy burden. But others have argued that the city has severely underfunded education in its 2013-14 operating budget.

I would argue that both views are off the mark and that next year’s budget is a fair balance between the needs of the city, especially the school system, and the needs of taxpayers.

We were faced with some difficult choices when the budget was crafted last winter. The grand list and revenues were virtually flat, employee benefits were increasing between 15 and 20 percent, we had already dipped into our rainy day fund for $1.7 million, and we had no idea what the level of state aid would be. Even though property taxes had increased the last four years by an average of 1.9 percent, we knew they would have to be higher in the 2013-14 fiscal year.

So we approved a balanced budget that increased spending for the Board of Education 4.4 percent over current levels, but also increased property taxes by 3.9 percent. Some say we should spend less in order to keep taxes low, others say we should spend more, especially on education. But it’s not that simple.

A few of those arguing the city is spending too much and that taxes are too high seem to believe our “highly paid” department heads, administrators and teachers are the cause of the problem.

Whether they are paid too much or too little, in a budget of roughly $310 million, is beside the point. If the budget had cut the salaries of 10 department heads by an average of $40,000, which I would never support, it would have reduced the tax increase from 3.9 percent to a little less than 3.8 percent. A tenth of a percent is not much, especially when measured against a mass exodus of employees.

Others have argued that the city’s rising pension and benefits costs are the driving forces behind spending and need to be reduced. These costs are governed by federal and state law, as well as our charter, and can only be addressed through contract negotiations. For instance, the charter requires the city to meet the annual required contribution to our pension fund, which is updated each year by an independent actuary. This year, unfortunately, the increase was about 34 percent.

However, our pension costs should decrease in future years because we recently negotiated a new type of plan with city unions; all new hires will be enrolled in a defined contribution plan (similar to a 401K), as opposed to the current defined benefit plan. Also, the city, through contract negotiations, has reduced health care costs by implementing optional Health Saving Accounts and making employee contributions commensurate with other towns in the state.

The point is, the city has been working with department heads and its unions to find ways to keep property taxes under control, despite next year’s uptick. And by doing so, we were able to increase the BOE budget by 4.4 percent, which does not include the more than $2 million in the capital budget for new textbooks and technology. Moreover, the current administration, like previous ones, is constantly searching for ways to increase revenues, which in the long run is the best way to alleviate budget pressures.

As mentioned above, this is a municipal election year, and sometimes the rhetoric goes too far and is downright irresponsible. For instance, it’s been argued in the local media that the city is responsible for the $4 million shortfall in the BOE’s 2011-12 operating budget. The writer, who is an employee of the BOE and a key operative for a Democratic mayoral candidate, wrote – and later defended on a blog – that the city controls the BOE insurance fund and thus is responsible.

These kinds of statements do not serve the public well. The BOE’s former chief operating officer, and the auditors from BlumShapiro, who spent several months performing a detailed audit of the BOE’s insurance and special education accounts, concluded that the board was, indeed, responsible. They also applauded the board and the city for moving quickly to implement a variety of controls to prevent similar shortfalls in the future.

Let’s hope, as the election gets closer, that the partisan rhetoric is closer to the facts.

Comments

7 responses to “Kimmel: Both sides miss the mark on budget”

  1. 0ldtimer

    Closer to the facts ? Sounds like a good idea. Please explain what City Employees got benefits increases of 15 to 20%. That statement “employee benefits were increasing between 15 and 20 percent” makes it sound like the City is giving a lot more to it’s employees and the employees are somehow to blame for the tax increase. Just the facts, please.

  2. LWitherspoon

    @oldtimer
    .
    I believe the facts are that the cost of benefits, specifically health care, have increased 15-20%. Some say this is due to mandates and taxes contained in Obamacare, others say it’s the very reason we need Obamacare. Either way, most likely the employees are getting the same health plan they’ve always had, but the cost of it is now 15-20% higher.
    .
    In many cases private industry has responded to increased health care costs by switching to high-deductible plans or plans with higher copays. If Unions won’t allow the City to do the same, then taxpayers will be on the hook for those substantially higher benefit costs and it will lead to either a tax hike or reduction in services.
    .
    If memory serves, the most recent Union contract negotiated by the City contained modest wage increases but was still regarded as a big victory for taxpayers because there were major savings from changes in health benefits.

  3. Joe Norwalk

    So for the period 2010 through 2014, which by the way coincides with one of the worst recessions in U.S. history, Norwalk citizens have had their taxes raised 11.5%. Was inflation, average wage increases, real estate value appreciation anywhere near this? Uh, let me think…no. Is the “modest” wage increase on my paycheck? Uh, let see..no. Did my health insurance benefits get better?? Uh…no.

    Where’s the Tea Party when you need them? Show me a fiscal conservative in any party and I’ll vote for them. Any in Norwalk? Nope…

  4. LWitherspoon

    @Joe Norwalk
    I agree, it’s disappointing that Norwalkers are resigned to the idea that taxes have to go up every year.
    .
    Still, it’s important to show up and pick the candidate who will raise our taxes the least.

  5. Off Da Hook

    I believe in taking baby steps before you learn to run. But Mr. Watts and Mayor Moccia working together for decorations is about as meaningful is the two of them announcing that they both like apple pie. Let’s see if they can agree on tax relief or how to fund the school department budget. Then we’ll be getting somewhere.

  6. Peter I Berman

    A courageous BOE – members Lyons, Haynie and Chiaramonte – with the able attorney Tom Moony secured a major arbitration victory based on excessive teacher salaries – 5th highest in the state. Where is the Common Council’s similar grit ? The Council can’t even ask why Dept Heads receive annual pay boosts. As long as we elect Council members not willing to demand a hard line on union negotiations Norwalk taxpayers will continue to pay the piper supporting among the highest municipal salaries in the state. Council members need some familiarity with budgets, finance and union contracts I’d we’re going to stop the gravy train. Mr. Kimmel is not that person. He has no problem with unions receiving excessive salaries relative to our incomes. When has Mr Kimmel, reportedly a NY City school teacher congratulated the BOE for their arbitration victory ? Or voiced strong objections to proposed City union contracts ?

  7. Bruce Kimmel

    Mr. Berman, you have so many facts wrong, it’s impossible to answer. Read the transcript of the Council meeting in which we were presented the contract, witness what I said, witness what the attorneys said. The main issues were: 1. the freeze, which was not based on salary levels, but on the economy and the city’s ability to pay, and 2. the salary schedule, which encourages senior teachers to remain in the system for a very long time, while making it harder for newer teachers to get past ten years. That is why our “average” salaries are so high. And by the way, I retired last June after 25 years as a public school teacher in NYC to join the faculty of NCC. Prior to becoming a public school teacher I received a Ph.D in Sociology/History from Columbia, where I taught Sociology. At the time, I was considered somewhat of an expert in 19th century agrarian economics.

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