Malloy To Rescue, State Budget Proposal Supports Two-Year Delay In Property Revaluation, Finch: ‘Especially Pleased’

Governor Dan Malloy’s budget proposal to the General Assembly on Thursday calls for up to a two-year delay on the implementation of property revaluation, good news for Mayor Bill Finch and city bean counters who were facing a massive hike in the city’s mil rate. Speaker of the House Brendan Sharkey has been cold to a reval delay, but it’s unlikely Malloy would have included the delay in his budget proposal without a signal from Sharkey he’ll support it. The proposed budget allows for a local option for all municipalities to delay.

The city’s putting on a push in this new state legislative session in a last-ditch effort to postpone reval through gubernatorial and legislative approval. A delay in reval will also extend into the mayor’s reelection cycle next year avoiding a major hike in the mil rate. Even with a delay in reval the mayor’s not looking at a pretty budget picture the next two years. Federal money that paid for 30 or so public safety officers under Barack Obama’s stimulus plan has run out, forcing the city to pick up that tab starting this year.

City officials want to delay reval for several reasons including anticipation of tax revenue for development projects such as the Steel Point redevelopment area coming on line. Some of the higher-taxed neighborhoods such as Black Rock and North End could absorb the reval blow. Implementing reval could also juice motor vehicles taxes, scare away businesses fearing a higher mil rate as well as put some fragile businesses over the edge. The city’s current mil rate is 41.855, among the highest in the state. Without a delay in reval the city was heading for the highest mil rate in the state.

Connecticut law requires all real estate to be revalued for assessment purposes every five years to bring about uniformity in property values and ensuring  everyone pays their fair share, or so it goes. Your property tax bill is a function of your assessment based on 70 percent of value. In this economy property values have sunk so as a general rule the mil rate approved by the City Council will spike to make up for the reduced assessments in order to fund the budget proposed by the mayor. A lot of this depends on the spending plan the mayor submits. Finch will now submit his proposed spending plan to the City Council the first week of April contingent upon a delay in reval.

Opponents to delaying reval, including the Connecticut Business & Industry Association, claim it’s poor public policy to put it off. The more frequently reval takes place, the organization maintains, the more accurate and fair tax assessments will be. Opponents also say delaying reval is nothing more than kicking the can down the road in an attempt to hide budget problems.

Malloy included these items in his budget proposal under the header Helping Cities And Towns.

Eliminate the Health Insurance Premium Tax on Municipalities – $8.7 million savings

Allow up to a two year delay on implementation of revaluation (local option)

$8 million increase in PILOT for Private Colleges and Hospitals

End the state charge to municipalities for DMV’s program to block registration of motor vehicles by people with delinquent taxes

$10 million for additional school security infrastructure grants

$10 million additional funding for Local Bridge Program, $50 million for Urban Act

New Advanced Manufacturing Fund provides assistance to companies locating in towns with traditional dependence on manufacturing 1,020 new pre-K slots

$40 million increase to ECS aid (per enacted budget)

See overview of governor’s budget here.

Statement from Mayor Bill Finch:

“I applaud Governor Malloy for recognizing the needs of the state’s cities in his 2014-15 budget proposal. It’s clear that he is aware of the challenges cities like Bridgeport face in the coming years as we try to balance budgets and grow our tax base so our residents are not always meant to feel the brunt of an unfair property tax structure. I am especially pleased that the Governor has included a measure that would allow for up to a two-year delay in implementation of revaluation in towns and cities across the state. Delaying the implementation of revaluation is critically important to Bridgeport because the City suffered a record number of foreclosures in the historic economic downturn of 2007-08. Governor Malloy also has honored his promise to increase education funding for the state’s largest city–the approximately $4 million boost to our ECS will enable us to provide better educational outcomes for our students.

“I want to thank the Governor for increasing funding levels to PILOTS for colleges and hospitals, and Mohegan/Pequot funds, and staying level on Local Capital Improvement Program funds and Town Aid Road grants. While these programs still fall a bit short of prior year’s funding levels, the proposals will enable us to continue to provide services and reinvigorate our infrastructure, while the economy struggles to bounce back.

“Additionally, I applaud Governor Malloy for his continued commitment to growing jobs in our state through innovative economic development strategies and programs to provide assistance to our small business owners and entrepreneurs.

“I am very proud of the Governor’s commitment to new investments in early childhood education, of which I am very supportive and focused on increasing the numbers of children who are able to access programs in Bridgeport, and expanding opportunities for college affordability so more students can realize their dream through higher education.