With the Municipal Accountability Review Board (MARB) rejecting the city’s approved budget last week, the city has until June 15 to put together a package that will satisfy the pane. The MARB exercised its new oversight power after the city was placed into Tier IV status by Gov. Ned Lamont. The new powers give the state board oversight and authority over the city’s finances
The Tier IV status was a consequence of a state-commissioned audit into use of federal COVID relief funds, and the allegedly fraudulent siphoning of funds into dummy companies by at least two former officials.
MARB rejected the budget due to an increase included for the city’s police personnel. Earlier this year the Voice reported the Police Commission going before the City Council, asking that salaries and benefits be brought up to par with surrounding towns. The city’s lack of a traditional pension plan (offering a 401k instead), plus the fact salaries are as much as $10,000 below average means the city is losing officers and having trouble recruiting new ones. At last count, the city is 14 officers below its standard, having 107 on staff, rather than 121.
In reviewing the budget, MARB members said the new spending on police was not backed up with concurrent revenue. Mayor Nancy Rossi defended the budget and said MARB’s decisions was based on erroneous information. In a questionnaire sent by the Voice this week, the mayor said the MARB’s concerns will be addressed in full.
“The budget submitted to the City Council was balanced, as was the budget approved by the City Council. MARB had received a report from Milliman, an actuarial study for the police department pension, which contained erroneous information and an incorrect higher annual contribution to the pension fund,” she said. “The report is being recalculated with the correct information and will be resubmitted to the city. The city will submit a revised budget to the MARB and the Five-Year Plan by June 15.
When questioned about the whether the MARB might tick up the mill rate, which stays flat at 37.48 (before fire taxes) under the City Council’s budget, she was less certain.
“The city will submit a responsible and balanced budget and make every effort to keep the mill rate flat,” she said.
Rossi reiterated the problem with the budget shortfall as seen by the MARB was one of an actuarial error that is now being corrected.
“The city submitted a budget with the correct contribution to the police pension fund, however, the MARB obtained a report with a higher contribution, which was not correct. A corrected actuarial study is forthcoming, and the revised budget will include the correct contribution, which will be much closer to the amount originally supplied by the city,” she said.
When asked what effects the new Tier IV status will have on the city’s ability to run or have autonomy, Rossi was upbeat.
“Being in TIER 4, the MARB will be more involved in financial aspects of the city including the approval of the annual budget. The city will work closely with the MARB on the revised budget to ensure all services are continued and the budget is balanced,” she said. “The city will continue to increase the commercial grand list, and the rainy-day fund continues to grow.”
In her final comments, Rossi said the city will work under the new Tier IV status, but took a swipe at those who she believes put the city in the position it is in.
“Although the city was elevated to TIER 4 because of the alleged theft and mismanagement of Cares Act funds by a few individuals, the city’s general ledger and financial outlook continues to improve,” she said. “I am angry and very disappointed that funds were allegedly embezzled under my watch. I take full responsibility, however.”
She said the city is moving toward making needed changes in its daily practices – a matter that has incurred the wrath of MARB members on several occasions.
“Moving forward changes have already been made and the city will continue to strengthen our internal controls. With that said, I will not allow this sad and unfortunate situation to derail or take the focus off the continued growth and progress the city is making,” she said.