Just how badly the ongoing COVID-19 pandemic will damage municipal finances is anyone’s guess, but for now, Hartford Mayor Luke Bronin isn’t willing to recommend drastic cuts for fiscal year 2021, which starts in just over a month.
On Monday, Bronin released his $568.8 million budget, recommending a modest 1%, or $5.5 million, cut to spending to next fiscal year. For the fifth year in a row, the mayor did not recommend an increase to the city’s property tax rate, leaving Hartford with a 74.29 mill rate — still the highest in the state.
The budget, which includes both city and school operations, is subject to changes and approval by the city council.
Bronin has budgeted carefully over the past few years in the wake of an historic state bailout of the city’s long-accumulating and unsustainable debt load. Spending growth has been small, and borrowing drastically reduced compared to prior administrations.
“We do not believe that it is responsible at this time to reduce services beyond the cuts already made in recent years, until the full fiscal impact of the coronavirus and the full extent of state and federal recovery funding is known,” Bronin wrote in his budget documents released Monday afternoon.
He was also clear that there was a “strong possibility” that the revenue decline could be greater than $5.5 million, possibly far greater.
About half of the city’s revenue comes from property taxes, and real estate values, as well as the ability of property owners to pay, could see major impacts depending on how the recovery shakes out.
“If the revenue losses prove to be much bigger, and if the federal government decides not to provide revenue relief to states or municipalities, we may find ourselves with very difficult choices later this year,” the mayor said.
He said Hartford and many other cities have already seen unprecedented job losses and business closures, and there could be more to come.
“We don’t know when the pandemic will pass, or how long the recovery will take,” he said. “We also don’t know how this crisis will affect our budget. The economic devastation from the coronavirus pandemic will result in lower revenue – possibly much lower revenue. We have no way of estimating with any confidence just how large that revenue loss will be.”
Bronin said his budget doesn’t rely on any one-time revenues, asset sales or deferments of obligations.
