.Hartford Treasurer Raises Concerns About City Budget
Says Mayor May Be Violating City Code
By Jeff Cohen
May 02, 2012
Hartford's city treasurer says Mayor Pedro Segarra's budget under funds the city's pension fund by 11 million dollars -- and that may be a violation of the city code. WNPR's Jeff Cohen reports.
Segarra presented his budget last month. When he did, he found lots of ways to close a ten percent budget deficit. One was to raise taxes on some residential property owners; another was to cut back on the money the city contributes to its pension fund. He's proposed putting in $20.6 million as opposed to $31.6 million.
But city Treasurer Adam Cloud says that's a bad idea. In a budget message to the city council, Cloud wrote this: "The failure to fully fund the pension fund is in essence a failure to abide by the Municipal Code of the City of Hartford."
In an interview, Cloud says that Segarra may also be putting the city's bond rating at risk.
"The impact to the residents of the city of Hartford is when we go out and borrow for capital projects, the cost of that borrowing will increase, which increases the budget of the city of Hartford."
And Cloud says that's a real issue.
"It certainly does concern me. In my past experience as a public finance investment banker I've seen situations where when you mess with the tried and true practices -- that municipalities do tend to get dinged."
Cloud says he has asked the city for an outside legal opinion on whether Segarra's contribution to the pension fund violates the city's code.
This comes as the city council is deliberating just what to do with Segarra's budget, which is for the year that begins July 1.
Asked for comment, Segarra's administration says the mayor is considering negotiating "an alternative, potentially more agreeable number." The city also says that it has one of the best-funded pensions in the state.