Dunn Says Despite State Fiscal Woes, Brookfield Shouldn't Take Such a Huge Hit

By Scott Benjamin

Brookfield First Selectman Steve Dunn said he acknowledges that Gov. Dannel Malloy (D-Stamford) faces huge fiscal obstacles, some of which pre-date his tenure.

He said he recognizes that Connecticut has a projected $1.7 billion deficit for the next fiscal year.

Dunn noted that he’s aware that for decades state officials didn’t properly fund the pensions for their employees as well as the local school teachers and even after a dramatic increase in money to the pension system by Malloy over the last six years, the obligations to the workers in the state collective bargaining units are only 35.5 percent funded and that the governor wants the municipalities to pay for one-third of the local teacher pensions because those costs have become a burden.

He indicated that he knows that unlike a generation ago, suburban Connecticut is at an economic disadvantage when, according to a poll, two-thirds of the college-educated mellenials live in the nation’s 51 largest cities, too many people 40 years or age and under have already left the Nutmeg State, and the nearby Route 128 brain hub in Massachusetts is a powerful lure.

The first-term Democrat said he agrees that state officials should have been trying to attract bioscience firms in 2007, when Massachusetts was taking those steps, instead of waiting until 2011 when Malloy – then in his first year in office - proposed providing $292 million in incentives to bring Jackson Labs from Maine to the University of Connecticut Health Center in Farmington.

Dunn, a former vice president at J.P. Morgan Chase in New York City, said he agrees with those that say there will continue to be limited growth in Connecticut’s economy since, among other things, the Stamford financial sector isn’t what it used to be and the two Native American casinos aren’t generating the slot revenues that they were a decade ago. Connecticut once seemed primed to become the Silicon Valley of Fuel Cell Technology, but UTC Power, the granddaddy of research in the field, closed operations in in South Windsor in 2014 after being purchased by a company based in Oregon, and Fuel Cell Energy, based in Danbury and Torrington, recently laid off 96 employees.

Furthermore, Dunn said “the current tax structure” could be more conducive to businesses.

“I understand that the state has a problem,” said the first selectman in a recent interview regarding the proposed $3.68 million reduction in state aid to Brookfield over the next fiscal year in the $40.6 billion state budget that Malloy unveiled February 8.

However, Dunn insists that municipalities, like Brookfield, with favorable bond ratings, shouldn’t be punished.

“The state needs to make a decision on what programs are most valuable,” said Dunn, who has lived in Brookfield since 1983.

“That’s going to be painful,” he acknowledged.

Under the governor’s blueprint, Dunn estimated Brookfield’s tax mill rate would increase 5.7 percent in a year when property values in town have been re-valued.

“I can’t do that,” he said, noting that state legislation from 2015 the municipalities are only allowed a 2.5 percent increase in return for a greater share of the sales tax revenues.

Bonding is exempt from that cap, but Dunn said it would be “irresponsible” to borrow for operating expenses. He was critical during the 2015 campaign of one-term Republican incumbent Bill Tinsley for doing that, and in his proposed budget for the next fiscal year, Dunn is increasing the amount of operating funds and reducing the borrowing for road repairs from what was allocated for the current fiscal year. He said eventually he wants the town to do all of the road repaving through “cash.’

Dunn said that typically in Brookfield it is difficult to get more than a three percent tax increase approved at referendum.

The 1996 and 2007 New England Association of Schools and Colleges accreditation reports on Brookfield High School’s program indicated that there is “a difference between ability to pay and willingness to pay taxes” in town.

Dunn said “it is wrong” for the governor to try to shift money from a majority of the town’s 169 municipalities – in some cases eliminating their educational cost sharing funds – and give huge increases to 31 municipalities, with much of it going to the largest cities.

“Some of the school districts with the highest spending per pupil have some of the worst results,” said Dunn.

“Given our spending per pupil, we have phenomenal results in Brookfield,” the first selectman added.

Dunn said it’s also “wrong” for the state to agree to fund the local teacher pensions in 1939 and then 78 years later “change the game” by asking the municipalities to pay one-third of the costs.

But - trying to put the fiscal crisis in perspective - he said he believes that Malloy’s proposal represents just “the opening barrage” and that months from now he will be telling towns that they will get at least part of their education cost sharing money. The Republican and Democratic caucuses have not yet offered comprehensive alternatives.

Dunn said Brookfield might have a municipal budget approved by the third week in May, which means he has to be “ultraconservative” about possible municipal assistance since the General Assembly doesn’t adjourn until June 8.

“That’s incredibly difficult,” he declared.

Considering the fiscal challenges, a final budget might not be signed until well after adjournment. In 2009, former Gov. M. Jodi Rell (R-Brookfield) and the General Assembly didn’t reach a tentative package until about September 1. Ultimately, Rell allowed the budget to become law without signing it.

Dunn said it would be better to reduce municipal funding for everybody and perhaps make a smaller reduction for the urban areas in need.

However, mayors, such as Middletown’s Dan Drew, the New Milford High School graduate who is exploring a run for the 2018 Democratic gubernatorial nomination, complain that their cities provide many regional services and have chunks of non-taxable property, such as state offices and Little Ivy League campuses.

“I can see both sides of it,” said Dunn.

“The other side is that you have to remember that Wesleyan employs many thousands of people who live in Middletown and own houses and pay taxes in Middletown,” the first selectman explained.

Dunn said despite Connecticut’s bleak outlook, he’s enthusiastic about Brookfield’s economy.

He acknowledged there has been a “sea change” in the economy since the 2008 recession that still plaques local real estate values.

“The housing market in Brookfield is good for homes at $250,000 to $400,000, but the ones over $500,000 are difficult to sell,” the first selectman said. He added that too many Brookfield residents still have lower-paying jobs that underutilize their skills.

However, Dunn said the long-awaited development of the 198-acre Town District Center near the Four Corners intersection of Federal Road could in the near future annually generate $2 million in additional tax revenue.

The plan was initially proposed by former Democratic First Selectman Ken Keller nearly 30 years ago. The 2009 opening of the 2.1-mile Route 7 bypass made the district possible as it eliminated much of the through traffic at an intersection that reportedly had up to 30,000 vehicle trips on a typical weekday.

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