City may see budget cuts

For New Haven city officials, the upcoming fiscal year will be a time of number-crunching cutbacks in an effort to make budget ends meet.

Prompted by public unease over the national financial crisis, Mayor John DeStefano Jr. announced Wednesday that the city may be forced to scrimp on social services, public school renovations and workforce salaries in the coming fiscal year. State budget rollbacks lie at the heart of New Haven’s shortage on funds, DeStefano said, and so the city won’t be receiving any help in the form of funds from either the state or federal governments.

“When the state catches a cold, New Haven gets pneumonia,” DeStefano said during a Wednesday press conference in City Hall, referring to the fact that 47 percent of all city revenue comes from state funding.

In an effort to procure more city revenue, DeStefano said he is considering levying local income, sales or land taxes. Currently, half of the “grand list” of New Haven taxpayers are tax exempt, he said.

The mayor also said he will examine a second potential round of layoffs for city employees and service providers. The first bout of layoffs and early retirements occurred on Sept. 19, when 34 city employees received notice that the city was cutting their jobs in order to save $900,000.

But City Hall Spokeswoman Jessica Mayorga said the city has not yet made any decisions concerning possible layoffs.

“This is all very preliminary,” Mayorga said. “We don’t know yet.”

But not everything has gone haywire in the financial sphere, DeStefano asserted. Yale, New Haven’s largest employer, is doing well economically, DeStefano said, referencing the University’s extension into Science Park.

Though the city is using spending cutbacks and possible taxes to counteract ill effects from the financial crisis, DeStefano maintained that New Haven “has no immediate problems today.” Instead, these measures are meant to preempt future economic backlash from the national fiscal disaster, he said.

“We shouldn’t deceive ourselves of how it’s going to be,” DeStefano said. “It’s going to be difficult.”

City Hall projects next year’s deficit to reach $800 million.

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