Dunn Says State Government Could Learn Fiscal Lessons From Brookfield

By Scott Benjamin

After nearly a year in a job where he’s working an average of more than 64 hours a week, Brookfield First Selectman Steve Dunn said even with a $3.3 million budget gap that he was informed of on his first day in office, a downgraded bond rating, an inadequate fund balance and the development of a central business district which is slightly behind schedule he would gladly compare his town’s fiscal portfolio with the state government’s debt-ridden financial blueprint.

In 2015, the General Assembly and Gov. Dannel Malloy (D-Stamford) approved a 2.5 percent cap on municipal budget spending in return for a larger share of the state sales tax receipts. Dunn said the legislation is “silly” since bonding is exempt from the cap and municipalities may be encouraged to borrow for items that should be in the operating budget.

The first selectman said that the attitude from the state government appeared to indicate that the small towns “don’t know how to run their financing.” He says Brookfield has a better record than the state.

Dunn said to overcome the $3.3 million budget shortfall that resulted from bonds that were not sold between 2000 and 2012, the town approved $1.9 million this spring to start rebuilding its fund balance. It is now at 5.2 percent, well below the recommended 7 percent that Brookfield has sought since former town treasurer David Scribner took office 21 years ago. That formula resulted in three rating upgrades in about 18 months in the late 1990s. Fitch boosted it to the highest level – AAA – in 2013.

Dunn, a retired vice president at J.P. Morgan Chase, said most municipalities with an AAA bond rating have “a 10 to 15 percent” fund balance. He said it will be a challenge, but Brookfield could reach at least 10 percent in two years. Moody’s Investor Services downgraded Brookfield’s rating earlier this year from AA1 to AA2 with a negative outlook. Dunn said rebuilding the rating would lower borrowing costs and also provide flexibility in the event of a large unforeseen expense such as the fatal tree accident on Pocono Road of 16 years ago that resulted in a $2.4 million settlement that stretched over three yearly installments.

As for the state, Dunn notes that legislators and the governor continue to “overestimate revenues and underestimate expenses.”

Two rating agencies downgraded Connecticut’s bond rating to AA-minus earlier this year, as state officials periodically have to address shortfalls – including a $930 million gap for the current fiscal year. Since then a third agency has downgraded its rating for the Nutmeg State. Now CT Mirror reports that there is a projected $ 3.24 billion deficit for the two-year budget cycle that starts in July and the state has $32 billion in pension obligations between now and 2030 that have not been funded. CT Mirror has reported that it will be difficult to make considerable cuts in the state budget because pension debts are expected to plague spending for the next 20 years.

Dunn said Brookfield has funded 95 percent of its pension obligations. He said most rating agencies consider 80 percent to “be stellar.”

The first selectman said he objects to the state’s frequent reliance on unfunded mandates. He said, for example, it wants Brookfield to become part of a regional health services network that would be far more costly than maintaining its current system of having its own director of health and a sanitarian.

Have you spoken with the governor about this?

“Dan and I don’t talk too often, he’s pretty busy,” Dunn said with a laugh.

He added that state Rep. Stephen Harding (R-107) of Brookfield, departing state Sen. Clark Chapin (R-30) of New Milford and incoming state Sen. Craig Miner (R-30) of Litchfield, all of whom represent or are about to represent Brookfield, “understand fully the issues faced by the small towns.”

Harding said he is seeking to require a two-thirds majority of both chambers of the General Assembly to establish an unfunded state mandate.

“More decisions should be made at the municipal level and not by bureaucrats in Hartford,” the state representative declared.

Dunn said Brookfield gets 15 to 18 percent of its state tax money back. Bridgeport gets 200 percent.

“I believe in helping your neighbor,” he said. “But to what extent.”

After renovating Caidgan Field and the town beach, both on Candlewood Lake Road, and building a new Kids Kingdom playground at the Municipal Center on Pocono Road – projects that were approved during former Democratic First Selectman Bill Davidson’s tenure from 2009-2013 - the town will formally open the final leg of its recreation transformation, the Still River Greenway, November 19. It travels from near the Police Headquarters on Pocono Road to the Four Corners, and will provide a safe place for bicycling, walking and running. Dunn noted that Brookfield hardly has any sidewalks, which creates hazards for bicyclists and runners.

Regarding economic development, the first selectman said construction of the 198-acre Town District Center near the Four Corners intersection of Federal Road is slightly behind the projection that Davidson announced three years ago, but it is on a path to becoming a vibrant pedestrian-friendly streetscape that will boost the town’s grand list. Dunn said currently 83 percent of the taxes come from residential properties. The percentage was about 86 percent a decade ago.

The development of a central business district was initiated by former First Democratic Selectman Ken Keller in the late 1980s. Dunn said Brookfield is about the only town in the country that will be “able to build its downtown from scratch. We have two great lakes, schools that attract families to move here and nice neighborhoods. Our Four Corners area doesn’t match the rest of the town.”

The first major step in the development of the area came seven years ago this month when the 2.1-mile Route 7 bypass opened under former Republican Gov. M. Jodi Rell of Brookfield, which diverted the traffic congestion at the Four Corners intersection. Demolition has taken place over the recent months to some of the former retail centers and new housing has been built over the recent years in the central business district, which eventually might look similar to Greenwood Avenue in Bethel.

Dunn said the town is expected to go out to bid by January on the streetscape and plans to create a pedestrian-friendly area with the electrical utilities placed underground to provide a better appearance.

“The next two years are important, because some of the things we put there will be there for the next 50 years,” the first selectman said. “We should spend the money to do it right,” he added regarding the streetscape that will be installed.

Dunn was elected by a 2 to 1 margin last year over one-term Republican incumbent Bill Tinsley.

Some of Dunn’s campaign lawn signs stated, “Restore Integrity,” and his campaign distributed a flier regarding charges of embezzlement against Tinsley that he pled no contest to and have since been removed from his record. The former first selectman has said the charges were false and resulted from a misunderstanding with the owner of the Ludlow, VT. liquor store where he was working.

Dunn said he has restored integrity, noting that relations among the board and commission members from the Democratic, Republican and A Brookfield parties has been “cordial.” Additionally, for the first time Brookfield has a financial system in which the books are closed out each month to account for each check that has been written, even if it hasn’t been cashed yet.

He said in a recent interview that early in his term he was getting a Freedom of Information request about every other day, but it had now been more than a month since one had come forward.

The first selectman said residents seeking information don’t have to write a letter to the town clerk’s office, they simply can make a request to him. Additionally, he said the resident outreach sessions that were a staple of last year’s campaign have continued once a month on a Saturday in the town hall.

Harding said municipal officials he’s spoken with have indicated that Dunn is willing to consider their positions and when possible has been flexible on his decisions.

“We’ve had a good relationship working together on a series of state-related issues,” the state representative added.

Dunn also reportedly attracted significant support last year from parents concerned about funding for the local schools. He said the increase for the schools in the $63.5 million municipal budget was higher than under Tinsley and steps are being taken to address the 50-year-old Huckleberry Hill Elementary School, which has expensive electric heat and outdated portable classrooms.

He said a Board of Education Facilities/Building Committee should submit a recommendation for the school, which he considers the town’s top capital priority, by next spring.

Dunn said there has been discussion of possibly combining schools if the enrollment in the district, which was at about 3,100 students a decade ago and is now down to 2,700 students, continues to decline.

However, the first selectman said one of the new residential developments in the Town District Center has added 24 students and with more projects being built, he believes there could be a noticeable upswing in enrollment within two years.

Dunn acknowledged that Brookfield has a history of renovating and adding to schools instead of building new ones. However, he said the $34 million renovation to Brookfield High School that began in 2006 provided relatively little new classroom space. A majority of the money for the project updated the structure to existing building codes, built a sewer line and two synthetic athletic fields. He said reports indicate that the current New Milford High School, which was approved in 1997 and was completed in 2000, was built for $45 million as an entirely new structure.

The first selectmen said he hopes residents will take their time to study options, noting that New Milford acted quickly in closing the former John Pettibone School last year.

On a separate subject, a committee is currently studying options for a new library to replace the facility on Whisconier Road that opened in 1975. Efforts to either renovate it or seek a new site began in 1999. Dunn said the timetable for a 32,000-square-foot new facility will largely depend on the town’s ability to borrow money and how it proceeds with other prospective capital projects that are higher priorities. He believes a new library should be built in the Town District Center, since it would generate more foot traffic for retail outlets. He said Ridgefield, Darien and West Hartford have reported a 40 to 60 percent increase in visitors since they renovated their libraries.

“It will become an anchor for our downtown in the same way the anchor stores attract customers at the shopping mall,” the first selectman said.

On another topic, a Charter Revision Commission began studying an array of issues this summer. Dunn said he hopes that there will be two or three recommendations that everyone can agree upon, such as increasing the amount of money the Board of Selectmen and the Board of Finance can transfer, since those figures have not been increased in several years as budgets have grown.

The first selectmen said if there is a long list of charter-revision items on the ballot, some voters haven’t studied all of them and are inclined to vote “No.” He said over the recent years, voters have opposed increasing the Board of Selectmen from three to five members and installing a town manager form of government. Thus, he doesn’t want to expend political capital on those issues.

“People are comfortable with the government that we now have,” said Dunn.

He said there are merits to having a town manager form of government - which was soundly rejected in 2012 at referendum - since a professional would be overseeing the details and the town boards and commissions could focus on policies. He noted that municipal workers have to make adjustments every time a new first selectman takes office.

Public administration professionals have said that the town manager form of government usually works best in upper middle income suburbs, such as Brookfield. Farmington and West Hartford are examples that they cite in Connecticut that currently have successful town manager formats.

However, Dunn said town managers sometimes become entrenched, which can create conflicts, and Brookfield would probably have to pay a town manager $140,000 to $160,000 a year – roughly double the current salary for the first selectman.