Citing the city’s dire need to raise revenue, Mayor Toni Harp warned on Friday that Elm City residents might have to pay more property taxes in the fiscal year beginning July 1.
Harp received the official 106-page report of her mayoral transition team at a Friday morning press conference. Addressing media during the event, she said she is considering including a tax hike in the budget she must present to city lawmakers by March 1.
“I know that [raising taxes] is something that people really don’t want to do — and I certainly didn’t want to do it — but one of the things that the report points out is our bad revenue position,” Harp said.
Harp said she would raise taxes before selling tax liens, which would mean trading rights over unpaid taxes for a lump sum. The transition team report specifically mentioned tax liens as one revenue-raising tool in the city’s arsenal but warned of such a move’s the political impact. The city is due a total of $11.2 million in unpaid real estate taxes dating back to 1998.
Under a tax liens sale, the government empowers a private company to recover unpaid real estate taxes, as New Haven did in 1995 with Breen Capital Services Corporation. Breen cut a profit by chasing down debtors, while the city used the money to help fund its school construction project.
Though selling tax liens is in the realm of possibility, Harp said, she is strongly inclined to pick another route to financial solvency. When asked if she will raise taxes, then, Harp declined to say.
“But you may be hearing that we [have to] raise revenue,” she added.
Harp said New Haven’s mill rate — the calculation of property taxes based on assessed value — is low compared to other cities of comparable size. The current rate, 4.08 percent of assessed value, is lower than Bridgeport’s, Hartford’s and Waterbury’s but a good deal higher than the rates in surrounding suburbs.
She said the city’s revenue stream is ultimately unsustainable, pointing to her transition team’s report as evidence. City departments, including Public Works and Parks, are vastly underfunded. The recent string of storms revealed the extent of personnel and equipment shortages, Harp said.
In introductory remarks, the transition’s leadership emphasized New Haven’s difficulty raising revenue. The city is highly dependent on property taxes, while nearly half of its grand list is nontaxable.
“We are in a difficult phase in terms of revenue,” said transition team chair Edward Joyner, a retired education professor at Yale and Sacred Heart Universities.
Attorney Mark Sklarz, the team’s vice-chair, said long-term thinking is critical. He said New Haven has suffered from a desire for instant gratification, calling city governance a marathon, not a sprint.
Joyner and Sklarz led a team of 14 transition team volunteers named by Harp in the wake of her election last autumn. Both said the hours of work spent studying every facet of the city reignited their passion for New Haven.
“I love [Harp] like a sister, and I’ve grown to love [Sklarz] like a brother,” Joyner said.
Harp enumerated five items from the report that are immediately actionable, including a few on which she has already begun work. She said a new, youth-oriented outreach center at the Bethel AME Church in Dixwell will help answer the report’s call for a more coordinated system of youth services in the city.
She said she would heed the report’s suggestion of partnering with the Connecticut Main Street Center, a nonprofit that seeks to revitalize commercial downtowns, to identify four streets in the city ripe for development.
Harp also said the report backs up her requests for the creation of a Minority and Small Business Initiative and a centralized grants-writing office in City Hall. The Board of Alders has so far hedged on both requests, seeking more information before alders move forward.
Finally, Harp said, she will direct Doug Hausladen ’04, her newly appointed transit chief, to identify low-cost or no-cost traffic-calming measures.
The report’s other recommendations include redesigning the city’s website, creating a transit district to streamline zoning and street redesign, hiring more police officers and developing alternative education for at-risk students within the city’s public schools.
The report focuses centrally on fiscal issues across departments — including police and fire overtime and school district deficits. It indicates that the current fiscal year may yield a deficit of up to $4 million, in part due to unexpectedly low returns the city will receive from building permits for Yale’s two new residential colleges.
The 2013–’14 budget amounts to roughly $497 million.