Mayor: Gov.'s Budget Creates $2.1 Million "Hole"

Gov. Dannel P. Malloy's proposed budget would mean a $2.1 million drop in state revenues to Middletown, according to Mayor Sebastian Giuliano, saddling local taxpayers with the prospect of a 0.6-mill tax hike to make up the loss.

"i jus heard the governor say he's not going to balance the budget on the backs of taxpayers," Giuliano said. "What's this?

"How am I going to fill a $2.1 million hole?"

Giuliano said the shortfall was highlighted in an analysis of the governor's budget message by the Connecticut Conference of Municipalities, which lobbies state government on behalf of city and town halls.

He said the governor's budget proposal eliminates a state tax credit paid to municipalities for machinery and equipment purchases by local businesses. Last year, that credit amounted to $48 million for Connecticut cities and towns, according to the CCM analysis; this year, Giuliano said, "I have to assume from looking at this that we're not going to get anything."

In other areas of the state budget, the mayor said, the impact of Malloy's spending plan is "pretty flat" for Middletown.

Education funding for the city would increase by $126,000. State funds meant to compensate municipalities for the presence of colleges, hospitals, park lands and other non-taxable properties -- so-called Payments in Lieu of Taxes or the PILOT program -- would drop by $389,000. That's a net loss of $263,000, or about 0.10 of a mill, he said.

Giuliano said he'll use the governor's figures when putting together his proposed municipal budget, which is due to be submitted to the common council April 1. The council's budget must be completed by May 15.

As for the final state budget and its impact on Middletown, the mayor said that will be up to state lawmakers. "What we're going to get is what the legislature decides," he said.