Town Council Taps Reserve Funds to Balance Budget

This story was posted by Jason Vallee. It was reported and written by Local Editor Kathleen Rumanni.

After hours of workshops the Cheshire Town Council Tuesday night approved a budget that slightly increases the mill rate and taps into the town's reserves to help avoid a bigger tax increase.

The council approved a budget that for the first time tops $100 million. The spending breaks down as follows: $16.1 million on general government, $8 million on debt service, $1.2 million on contingency and non-recurring capital reserve, $6.1 million for employee benefits, $5 million for the Police Department, $63.7 for the Board of Education.

The council set the mill rate at 27.6 mills, increased from the current 27.23 mills, an increase of 1.39 percent. A mill is equal to $1 of tax for each $1,000 of assessment, according to the state Office of Policy and Management. The average home assessed at $200,000 will pay $5,520 in tax.

They had to take several hundred thousand dollars out of reserves to make the budget work because of a "cash flow problem," Council President Tim Slocum said. The town is approving a budget without knowing what is going to happen at the state level, he said, and as it is, the governor's budget eliminates PILOT payments for state buildings such as the Cheshire Correctional Institution that the town has come to rely on. It's likely that revenue will be made up in other forms, but when the town will receive it isn't known, so it's a wait and see game.

Not using the reserves would have meant a one-mill tax increase, Slocum said. "I think a tax increase is a millstone that [residents] don't need to wear," he said. "Hartford has left us in a bit of a muddle here."

"Residents have said if this is a rainy day fun, when is it going to start raining if it isn't raining now?" Councilwoman Sylvia Nichols said.

Democratic Councilman Michael Ecke said when the Democratic-controlled council presented a budget in the past that utilized reserve funds, Republican members weren't receptive.

"If I delivered this budget, you would be burning me in effigy in the center of town," he said. "What you have failed to talk about is the tremendous amount of reserve funds you are using this year. If a Democrat has proposed this budget there would have been sharp criticism because we have heard it — that we are using reserves to keep the mill rate low so it will look better in the fall."

"I won't level that criticism," he said, "but it's close."

"For the last four years, the mill rate increase has been very close," Slocum said. "We don't operate on if it's not an election year, let's raise the mill rate."

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