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Saturday, January 15, 2011

Litchfield facing loss of budget revenue

LITCHFIELD – The dismal economy and changes to state education aid strongly influence proposed budgets by the town and school district.

The municipal Budget Committee unveiled the separate budgets Thursday night, illustrating how the town and school district want to cut costs to mitigate diminished revenue.

Yet, despite the cuts, the tax rate will increase, mostly because of those revenue losses.

The school district expects to lose $1.73 million in revenue next fiscal year, and the town will probably see a loss of $65,825, the committee said.

The school portion of the tax bill would increase 81 cents per $1,000 in assessed property valuation if the school operating budget and a cost-of-living raise for nonunion positions pass at the polls in March.

The town portion of the tax bill would jump 24 cents per $1,000 if the town budget and a few other proposals gain voter support.

“There have been deep cuts in revenue,” Budget Committee Chairman John Harte said at Thursday’s public hearing.

As a result, the committee aimed to keep the town tax rate flat and increase the school tax rate by no more than 3 percent, Harte said.

The potential hike in local school tax is caused by the largest proportional hit any municipality will face in lost state education aid, the committee said.

An estimated $2.14 million loss in state aid offsets any other revenue gains the school district could see, creating the $1.73 million revenue shortfall, the committee said.

To adjust, the district and Budget Committee propose a $19.65 million operating budget, a reduction of $1.05 million from the current school budget.

The School Board forwarded an $892,746 budget reduction, and the Budget Committee found an additional $165,491 to cut, arriving at the $1.05 million figure. It would amount to more than 5 percent less spending next school year.

The bulk of cost reductions, if approved by voters, would come through cuts in staffing.

The district proposes cutting the equivalent of 27.5 full-time jobs, including the equivalent of 12.5 full-time teaching positions.

School Board members have said the cuts wouldn’t greatly affect classroom sizes at Griffin Memorial, Litchfield Middle or Campbell High schools.

Position cuts would also affect administration jobs and paraprofessionals, among others.

The $2.14 million takeaway in aid results from the state’s new funding formula. Passed in 2008, the formula adjusts aid figures every year based on districts’ enrollments and inflation, among other factors.

State Rep. Ralph Boehm, R-Litchfield, told the audience that a new bill aims to address the faults of the aid formula, and that perhaps someday – but not next school year – education funding will increase.

On the town side of the ballot, voters will see a proposed operating budget of $4.49 million, a decrease of $51,943 from the current budget.

Warrant article items include a collective bargaining agreement for unionized municipal employees and a proposal to place annual state Department of Transportation grants into the operating budget.

Another proposal seeks the appropriation of $209,250 this year and $279,000 annually to make fire protection fees from Pennichuck East Utilities equitable for all residents, both customers and non-customers, selectmen said.

By having the protection charges instead go directly to the town, each home would pay $7.25 a month for fire hydrant services, selectmen said. More than half of residents now pay $12.59 a month.

Albert McKeon can be reached at 594-5832 or