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NORWALK, Conn. — Norwalk.DailyVoice.com accepts signed, original letters to the editor. Letters may be emailed to letters@dailyvoice.com.
To the Editor,
On June 12, before hundreds of concerned residents and employees of the school system, members of the Norwalk Common Council were asked to support a resolution that would have provided $4 million to the Norwalk Board of Education. Even though that resolution was referred back to the Finance Committee and ultimately defeated a few days later, I believe it is important to discuss the reasons so many council members could not support the obviously well-meaning resolution. (Before continuing, I should mention that even though I was a member of the Council's Finance Committee for eight years, and its chair for four years, I am currently not a member of that committee. I do attend its meetings, but I do not have voting rights.)
There are four reasons why I could never support such a resolution:
■ The first reason is that the wording of the resolution required the BOE to repay the $4 million over a period of four years. The BOE does not have the legal authority to take out loans. Nor does it have revenue streams, apart from the federal, state and city governments, upon which it might craft a repayment schedule. And finally, there is really no way for the council or the Board of Estimate and Taxation to collect repayment, other than by drastic reductions of future budget requests.
If the resolution had passed, I am certain that down the road council members would again be facing hundreds of concerned parents, but this time they would be carrying placards that said, "Forgive the Debt." The bottom line is that the BOE does not have the legal authority, and with good reason, to take out anything that resembles a loan.
■ The second reason I could not support the resolution is because it was essentially a one-time cash infusion to address a structural problem. This is a serious issue in the world of finance and has been the downfall of many local governments. Structural problems, unless addressed and eliminated, are recurring. The BOE's recent shortfall appears to have originated in the area of special education, and the board has still not been able to provide assurances that it will not happen in future years. (The details of what happened are still being examined by the city.)
This is an important point: The fiscal pressures that caused the shortfall still exist. The board, through no fault of its own, cannot control these pressures (the worlds of insurance and special education are governed by a variety of laws). Thus, the resolution was basically asking council members to provide a quick fix to a problem that will likely reappear next year and in the year after that. And to require the board to begin repaying the loan – while simultaneously addressing the rising costs of insurance and special education – is asking the impossible.
■ The third reason I could not support the resolution is because it would have required the city to withdraw $4 million dollars from its Rainy Day Fund. It is important to note that the city has already dipped into that fund, to the tune of $2.2 million, for the 2012-13 operating budget ($1.1 million was withdrawn to finance the state mandated 2013 property revaluation, and a similar amount was withdrawn for various operating expenses.)
Another withdrawal – especially a short-term fix to a structural problem – could very well jeopardize the city's AAA bond rating. Many residents, and a few council members, have questioned the city's sensitivity to the opinions of rating agencies. But I share that sensitivity. According to the finance department, if our bond rating were reduced to a AA rating, the costs in additional interest payments on capital projects – costs that would have to paid by taxpayers – over a 20 year period (assuming our capital expenses remain roughly the same) – could be as high as $22 million.
A reduction in the city's bond rating would make it difficult in the near future to fund various construction projects, road repair, etc. Our infrastructure, which is currently in need of repair, would undoubtedly deteriorate further. And, as mentioned, the debt service portion of the operating budget would rapidly rise, thus (and ironically) making it even more difficult to fund future BOE operating requests.
■ The fourth reason I could not support the resolution is that it was not vetted by any committee. It came to the Council on short notice (I didn't see it until a few days before the packets arrived) and was written, apparently, without anyone having addressed the issues raised in this column. Two days after the full council meeting, the finance committee met and all of the issues associated with the shortfall and a $4 million withdrawal from the Rainy Day Fund were thoroughly discussed. At that point, committee members defeated the resolution.
Comments (3)
Bruce, thhanks for writing this informative op Ed. There has been a lot of emotion and half truths. Your background as a teacher, councilman and previous role on the finance committee places you in a unique situation to tell folks like it is. We need calmer heads to prevail when dealing with such an emotional and complicated issue as educating our kids. It took several years to get into this mess and it will take a few years to get out of it.
Bruce you raise good points, but in the end a Common Council Resolution has no teeth, it is merely a feel-good political theater moment. It is a shame that these points were not given the opportunity for discussion and debate amongst your fellow Council members, on that note the process followed as you describe, is blindingly the wrong approach.
The structural problems you allude too are interesting. From what I understand of the issue, the City did not allocate the full 100% of the BOE request to the special pension obligation fund because of other line items that overran. The technical issue for me, was whose decision was it to essentially raid the pension fund? It does not seem that the BOE made that decision.
While you may not be in favor of the resolution, Bruce, at least the City made an attempt. People keep saying that the City doesn't care about education, but that's not true. A resolution was proposed. And it's important to know that well over 50% of the total revenue of the City goes to education.
I'd also like to point out that if the City actually does go and raise taxes to get the extra 4 million to give to the BOE, once they do that, they will be required BY LAW to continue to give that new amount (whatever is the current amount plus the 4 million) to the district every year.
And yeah, I've heard all about how the Board has gotten 0% increase for the last umpteen years. Yeah, yeah, yeah. Guess what, neither my spouse nor I have seen a raise in our jobs for the same amount of time. Truthfully, we're glad we're still employed.
Face facts. We simply don't have the money. The District really needs to deal with the fact that this isn't 2005 any more. Raising the taxes will push the people on the low end of the earning scale out of Norwalk. Yep, those who are the most vulnerable, the elderly on fixed income and the lower middle class.