POWELL: New Haven wants bailout with no questions asked

Published on Monday, 15 March 2021 21:39
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By CHRIS POWELL

New Haven is clamoring at the state Capitol for a bailout, if not as big as Hartford's three years ago. But the leaders of the General Assembly's Democratic majority, including New Haven state Sen. Martin M. Looney, the Senate president pro tem, are asking only: How much do you want?

Looney and his colleagues propose rewriting the state's municipal aid formula to New Haven's benefit so they can avoid asking: How did the city's finances get so out of hand?

In pursuit of a bailout, Mayor Justin Elicker has proposed alternative budgets for the city. One assumes that, to cover a projected deficit of $66 million, New Haven will get that much more money in a combination of increased aid from state government and a bigger voluntary contribution from Yale University, whose property in the city is tax-exempt. With that much extra money, city government could go on as normal - which would be awful.

Mayor Elicker's second budget assumes no bailout, causing the city to lay off scores of employees and suspend basic services. That would be awful too, but then it may be the prerequisite for Connecticut to examine the reckless administration of its cities.

Such an examination was not undertaken three years ago when Hartford city government's incompetence and insolvency could not be concealed anymore after the city spent $80 million to build a minor-league baseball stadium. The only recourse seemed to be reorganizational bankruptcy.

Instead the legislature passed what was presented as a modest increase in financial aid for Hartford. But Gov. Dannel P. Malloy construed the legislation as authorizing state government to assume more than $500 million of Hartford's long-term debt - whereupon legislators just shrugged off their cosmic misunderstanding and the bailout proceeded even without ever having a public hearing.

While the legislation subjected Hartford to a state oversight board, two of its five members are representatives of city employee unions and two others are former city officials who bear responsibility for the city's financial collapse. So the board has not seriously challenged city government operations.

Mayor Elicker says New Haven's projected budget deficit is caused by increases in "fixed costs" - city employee compensation and pensions as well as by interest on the city's long-term debt. Last month the mayor told a legislative hearing that New Haven has more than $900 million in unfunded pension liabilities.

Who fixed those costs, supposedly putting them beyond the control of elected officials? Did God do it?

If not, who can unfix them, and how?

Who underfunded the pensions for so long?

No one in authority is asking those questions.

Mayor Elicker says: "This financial challenge we face is a result of a structure in the state where municipalities such as New Haven cannot adequately collect enough revenue to fund the very services our residents need and many residents in the region rely on."

But again no one in authority is asking why, if the city could not collect the necessary revenue, it has been spending all the extra money anyway. But an explanation can be guessed -- that, in light of the bailout Hartford received, New Haven has expected that it could get away with just as much irresponsibility as Hartford did and that state government would be forced to pick up the tab eventually.

There are two underlying problems here.

First, Connecticut's cities lack the self-supporting, independent, private-sector middle class necessary for self-government. The political class in the cities consists mainly of government employees and other government dependents whose interest is to drive up costs, not control them.

Second, the state's majority political party, the Democratic Party, draws its crucial pluralities in state elections from operating the cities as poverty and patronage factories. Larger appropriations for the cities don't improve them as much as they serve as public financing for Democratic campaigns.

Cities that can't unfix and control their costs should be administered by a state agency with sharp teeth, not a lapdog of union and former city officials. Otherwise the cities will never improve and an expensive bailout for Bridgeport will be next.

Chris Powell is a columnist for the Journal Inquirer in Manchester.



Posted in The Bristol Press, Column, Editorials on Monday, 15 March 2021 21:39. Updated: Monday, 15 March 2021 21:42.