Mayor John DeStefano Jr. set the stage for what may be a contentious budget season during a press conference at City Hall Monday.
In order to achieve a balanced budget, DeStefano said the city must take steps in four key areas: tightening city employees’ pensions and health benefits, collecting revenue from sources other than property taxes, and cutting some city services. DeStefano warned that not many politically palatable measures remain available, and “just saying no” to difficult choices is no longer an option.
“What we need to do now is make some hard but right choices,” DeStefano said.
The mayor painted a grim scenario of what “saying no” might look like by calling to mind cities like Newark, where nine people were shot and three killed two weeks after the city had to lay off 167 police officers.
New Haven can avoid compromising essential city services such as public safety if fiscal reforms are pursued in other areas, especially regarding city employee costs.
DeStefano said city employee pension agreements must require greater contributions from employees and increase the penalties for retiring early, among other changes.
Health plans for city employees must be tightened to be more in line with “the plans taxpayers receive,” DeStefano said.
If both pensions and health benefits are addressed adequately, DeStefano said, the city can avoid furloughs, pay cuts and layoffs — and even afford “reasonable” pay increases.
In terms of additional revenue sources, the city wants to establish a stormwater authority which would charge property owners for the city’s handling of stormwater runoff from their properties.
DeStefano also wants greater flexibility for the city’s taxing powers, he said. Currently, New Haven is by law only allowed to levy property taxes, which rose four percent last year. DeStefano said he wants the state to “untie our hands” and permit the city to establish other kinds of taxes.
Most importantly, he wants the city to be able to charge bars and nightclubs in New Haven’s “entertainment district” a tax to pay for around $12,000 in weekly police overtime costs in the district. Democratic governor-elect Dan Malloy has voiced support for allowing such “local option” taxes.
New Haven’s budget, which currently has a $8 million gap, will also see some service cuts, DeStefano said. Among the cuts he will propose are reduced library hours, cuts to homeless services, and a reduction in the number of neighborhood police districts.
“People are going to say no to everything I have just talked about,” DeStefano said. “But we can emerge stronger and better if we make some choices in 2011.”
The mayor will submit his budget to the Board of Aldermen on March 1.