Connecticut Towns Grapple with Big Funding Cuts Amid Budget Deadlock

By Joseph De Avila Features Dow Jones Newswires

Connecticut cities and towns Monday were hit with a big wave of education funding cuts hit, forcing municipalities to freeze spending and consider tax increases as the state moves into its fourth month without a budget.

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Garry Brumback, town manager of Southington, said he instructed town departments to come up with plans to cut spending by up to 10%. He also froze hiring and capital purchase. If the state doesn't pass a budget and provide Southington more funding soon, the town will be forced to have across-the-board layoffs in areas of public safety, roads and parks.

If the state fails to pass its own budget, it will cut education funds to the town by $20 million, or about 14% of the town's annual budget.

"Nothing will be unscathed," Mr. Brumback said.

After failing with lawmakers to agree to a new budget at the start of the fiscal year in July, Gov. Dannel Malloy, a Democrat, signed an executive order to keep state operations running. But the executive order can only provide funding based on the state's current revenue projections. That required cuts to municipal aid in excess of $900 million, most of which fell on education funding.

Some of those reductions can be reversed, but that will require the state Legislature to pass a budget that can be signed by the governor. Reaching agreement on how to close a two-year $3.5 billion deficit has been difficult.

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Republicans lawmakers along with a few Democrats passed a budget in September that gave more funding to towns but slashed spending for the University of Connecticut. It also required teachers to pay more for their pensions. Mr. Malloy vetoed that plan last week. The House of Representatives will convene a veto override session Tuesday.

Leo Paul, first selectman of the town of Litchfield, said lawmakers should overturn the governor's veto. The governor's executive order would eliminate state education funding this year for Litchfield, which received $1.5 million from the state last year.

Mr. Paul said the cuts to municipal funding could force his town to raise taxes by up to 8%.

"That is unacceptable," Mr. Paul said.

Mr. Malloy's executive order keeps education funding flat for the municipalities that have the lowest-performing school districts. That means the city of New Haven will get $154.3 million in education funds from the state, which is the same as last year. But the executive order also cuts funding for reimbursements of nontaxable property and other payments by $67 million.

The city enacted a hiring freeze for nonpublic safety positions and shut down new contracts, said Toni Harp, mayor of New Haven. It also stopped a youth-work program for this fall, she said.

"We are hurting," Mr. Harp said.

Write to Joseph De Avila at joseph.deavila@wsj.com

(END) Dow Jones Newswires

October 02, 2017 17:00 ET (21:00 GMT)