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August 22, 2007

State $38M short on school projects
By: Ed Stannard
Reprinted from The New Haven Register

The checks won’t be in the mail this month to pay for municipal school construction projects, unless state leaders take action quickly.

The $38 million shortfall is the result of the General Assembly’s failure to pass a bond authorization package in this year’s session, according to a letter sent Tuesday to Gov. M. Jodi Rell and legislative leaders by James J. Finley Jr., executive director of the Connecticut Conference of Municipalities.

"Connecticut towns and cities need your help in coping with an emergency situation arising from the delay in school construction bond authorizations this year," Finley wrote.

The lack of bond money means towns and cities have to find other ways to pay the contractors they’ve hired to build or renovate schools.

"We urge you to ensure that municipalities are kept whole, either through existing sources of state funds or by appropriating surplus funds to provide the $38 million in August funding they will need to meet their contractual obligations," Finley wrote.

New Haven was expecting $9.32 million in August payments for six projects in the citywide school construction and expansion program.

Other area school districts affected are West Haven, $1.36 million; Milford, $615,569; and the Amity Regional School District, $340,329.

Brian Mahoney, chief financial officer for the state Education Department, sent an e-mail to school superintendents Thursday warning that the money was not available for mid-August payments.

Thomas Murphy, spokesman for the Education Department, said, "We have to adjust to the assembly’s schedule and they’ll be coming back in September. … Hopefully it will only be one month."

CCM’s letter warned that unless money is found, September payments of $60 million to $70 million will be in jeopardy. The letter was sent to Rell and Democratic and Republican leaders of the state House and Senate.

Lawrence D. Rusconi, New Haven’s budget director, said the city had to take out a short-term note to pay its contractors, which will cost $50,000 to $60,000 in additional interest if the money were not to come within 90 days.

"It was a rather shocking revelation last week when we found out," Rusconi said. "The issue for us and for all the other cities as well is we’ve contractually committed to make progress payments."

He said the state has a commitment to its municipalities to send the money as scheduled, and added, "I can’t for the life of me figure out why the state would have waited till the week before (payments are due), because the work’s been done."

Kenneth Carney, chairman of West Haven’s Building Oversight Committee, said the city applied for the state money after the Forest School project had begun, as part of its efforts to collect money for which the previous administration had not applied.

He said the $1.36 million "would be a great shot in the arm" and would have been the first major payment of $4.2 million the city has sought to alleviate its deficit.

Rich Harris, spokesman for Rell, blamed the General Assembly’s leadership for the failure to negotiate a two-year bond package.

"She’s been concerned for quite some time about the failure to pass a bonding bill," Harris said of the governor. "She’s called on the legislature on a number of occasions to get the job done."

The holdup, he said, is that legislators are seeking "175 earmarks totaling some $208 million, and it’s just more than the state can afford."

He said it’s up to the assembly to open the spigot on school payments. "The fact is, without legislation to enable it, the Bond Commission can’t allocate the funds," Harris said. He said legislation also would be needed to use surplus funds.

Gian-Carl Casa, director of public policy and advocacy for CCM, said, "Our point is that the creation of a bond package always entails give and take."

Casa said he was optimistic the assembly will fix the problem. "It seems like there’s an intention (for) the parties to get this bond package done in September," he said.

A spokesman for House Speaker James A. Amann, D-Milford, said he was unavailable. Senate President Pro Tem Donald E. Williams Jr., D-Brooklyn, also could not be reached.

Officials for Milford and the Amity school district did not return calls for comment.

Related Story: Connecticut Conference of Municipalities calls on Governor, state legislative leaders to end delay in releasing $38 million in promised school construction bonds


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