To the Editor:
As expected, the upcoming fiscal year budget was a challenge, to say the least. Roughly one year ago, immediately after the COVID-19 public health emergency was declared, our annual budget referendum was cancelled by executive order of the Governor.
As a result, our Board of Finance was put in the unenviable and extraordinary position of making the final decision on Monroe’s budget all while our state was being ravaged by the pandemic. Businesses were forced to close, unemployment was high, and our economy faced incredible uncertainty. Without reservation, I joined the Board of Finance in setting a goal to avoid the additional pressure that any tax increase, in the midst of the pandemic, would cause our taxpayers.
Over the past several years, we have been diligent in building a healthy unassigned fund balance, often referred to as the “rainy day fund.” Sticking with that analogy, Board of Finance Chairman Mike Manjos gave a simple assessment of the economic situation in April 2020: “It’s pouring.” I fully supported the Board of Finance’s decision then to appropriate a significant portion of our rainy day fund in order to avoid a tax increase. Monroe was not alone implementing this financial strategy.
However, we accurately recognized that this would create additional taxpayer pressure for the FY21-22 budget. The costs of important things like healthcare insurance, the state’s pension program for our police officers, and recycling continue to rise.
I am grateful that our unions agreed to my request for economic concessions last year, allowing us to keep overall salary and wage costs flat, despite contracts that said otherwise. After essentially skipping a year in those agreements, these employees — the vast majority of whom continued to work every day during the pandemic — are now due a small but reasonable increase next year.
Without question, the most challenging aspect of Monroe’s budget continues to be that attributable to the Board of Education. While the importance of our robust educational system cannot be understated, we must be clear that it accounts for over 2/3 of the entire Town Budget and is the single largest driver of our tax rate. While overall municipal costs are up 2.36%, the Board of Education increase is 5.16%, even after the Board of Finance and I reduced their requested increase by a total of over $400,000. Of our total increase in operating expenditures, just over 80% is attributed to increases in education costs.
In preparing the FY21-22 budget, I remained committed to controlling taxes while improving roads and infrastructure, delivering cost-effective services to our community, providing excellence in education, and maintaining the financial health of the Town. It is now clear that we will need to utilize less than half of the rainy day fund appropriation during the current year. The Board of Finance’s proposed budget therefore maintains a reduced, but responsible, use of fund balance again in FY21- 22 as we transition out of the public health emergency. Our “rainy day fund” will remain within an acceptable range as set by Board of Finance policy. Furthermore, while significant federal funding anticipated from the American Rescue Plan, we are specifically prohibited from using those funds to cut taxes. I am hopeful that once we receive the final, detailed rules from the U.S. Treasury, the ability to restore fund balance will be among the options we will be able to consider.
Without our growth in the grand list, a conservative and disciplined approach to spending, and use of alternative funding, taxes would grow at an alarming rate of over 9%. The budget now results in a projected tax rate increase of 2.48%. This is an average of less than 1⁄2% per year over the past four years.
I greatly appreciate the dedication of our staff, educators, and volunteers – including those serving on boards and commissions – who contributed to this year’s budget process. I am very appreciative for the time and due diligence of our Town Council and Board of Finance, both of which approved their proposed budgets in unanimous, bipartisan votes. I now submit the Fiscal Year 2022 budget to referendum, and encourage the citizens of Monroe to exercise their right to vote on May 4, 2021.
The complete proposed budget document is available in the Town Clerk’s Office, the Library, and online at www.MonroeCT.org/budget. All customary polling locations will be open from 6am – 8pm.
Ken Kellogg
First Selectman
