The city of Hartford, which has been on the verge of bankruptcy, received significant help from the bipartisan budget plan passed by the state Senate early Thursday.
The two-year state plan includes $28 million per year in a new “municipal restructuring grant.” Sources say Hartford would receive at least $20 million of those funds.
The new budget also includes another $20 million in annual assistance for the Capital City that specifically would be used to help cover Hartford’s debt service on bonded debt.
Hartford would be required to refinance a significant portion of its bonded debt. But Connecticut also would guarantee this refinancing, helping the city to obtain a more favorable interest rate.
And though specific projections were not available, Hartford’s annual debt service costs also would drop in the short-term because of the refinancing.
Hartford Mayor Luke Bronin warned the Capital City needs an additional $40 million in yearly assistance to avert insolvency and that the city could file for bankruptcy protection as early as November if the state budget is not resolved.
