Mayor Pedro Segarra on Monday presented a $546.6 million proposed budget for 2012-13 that decreases spending but still raises the city's tax rate by 3.5 mills.
The budget represents a $1.2 million decrease in spending over the current fiscal year, Segarra said, adding that under his plan, most city departments will receive the same amount of money next year.
The tax rate increase would mean a roughly 4 percent rise in taxes for owners of single-family homes, Segarra said.
It would mean a decrease of about 1 percent for owners of two- or three-family homes, he said. A mill equals $1 for every $1,000 of assessed property value. The city's current tax rate is 71.79 mills.
The increase in the tax rate is meant to help offset a $56.2 million deficit the city is facing as a result of the property revaluation. The city will take in about $35 million less in property tax revenue due to declines in market values and the elimination of a surcharge on commercial properties. Expenses are also expected rise about $21 million, with payroll, pension contributions and money for schools going up.
David Panagore, Hartford's chief operating officer, said Monday that the city will close the gap through a variety of strategies, including seeking $1 million in union and nonunion concessions — possibly through furloughs — $1 million through a voluntary payment in lieu of taxes program, $1 million in Medicare reimbursements, $9 million in state reimbursements for school construction projects, $3 million through the increased collection of delinquent property taxes, the elimination of 23 vacant city jobs, the sale of $600,000 worth of city-owned property, the tax rate increase and the decrease in overall spending.
The city also would receive about $8.35 million in additional tax revenue under state legislation that raises the assessment ratio for residential properties, Panagore said.
Segarra said he has not yet reached agreements with the city's nonprofits for the PILOT program. City officials have said they are still negotiating with the unions for concessions, but no deals have been made.
Without the various methods of offsetting the deficit, Segarra said, he would have had to raise the tax rate by about 11 mills.
"I can tell you that no year compares to this by way of the challenges we have to meet," he told a crowded room at city hall Monday.
Segarra said his budget also calls for the hiring of 22 new police officers and 20 firefighters. The city will also contribute $300,000 more to the Hartford Public Library.
City Councilman Kenneth Kennedy, a Democrat and former chairman of the panel's operations, management and budget committee, called the mayor's budget "responsible," but said the city council would likely look for ways to "pare down" the tax rate increase.
"I think it is a great starting point," Kennedy said Monday. "Anytime you do a budget, it's a balance between maintaining services and the burden you want to put on the taxpayers to maintain those services. This shows an effort on the part of the administration to keep costs in line. The question is how much does the council want to keep those costs in line."
The city council will now have the opportunity to amend the mayor's budget. The city's deadline to adopt a budget is May 31.
The mayor and other city officials will hold a public hearing April 25 on the proposed budget. It will begin at 5 p.m. at Bulkeley High School, 300 Wethersfield Ave.
Reprinted with permission of the Hartford Courant.
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