Llodra Analysis: Malloy’s ‘Plan B’ Could Cost Newtown Nearly $2 Million; Lyddy Also Weighs In

By John Voket

Newtown’s State Representative Chris Lyddy, along with virtually all his elected colleagues in Hartford, was in an uncomfortable holding pattern this week as talks between top state officials and state union leaders continued behind closed doors.

But being in the position of waiting to see if the financial logjam breaks completely, partially, or remains in place, triggering what Governor Dannel Malloy has dubbed “Plan B,” may be substantially more uncomfortable for municipal leaders like First Selectman Pat Llodra. She, along with Finance Director Robert Tait, drilled into the ramifications of Plan B, the proposed alternative to receiving at least $1 billion in concessions from state unions to balance an already proposed and approved spending plan for the next two years.

In a release issued Thursday morning, Mrs Llodra delivered the worst-case scenario: nearly $2 million less in anticipated state revenues already figured into Newtown’s current budget proposal, which goes to taxpayers in a second-round referendum May 17. (See separate report in this edition or online at www.NewtownBee.com)

Using proposed Plan B reductions provided to Newtown officials late last week from the Connecticut Conference of Municipalities (CCM), Mrs Llodra and Mr Tait took the anticipated revenues in the existing governor’s budget proposal and did the math figuring additional reductions against what is already being applied in the local budget proposal.

Applying 100 percent reductions to the Pequot-Mohegan Fund and Town Aid Road grants, a 50 percent cut to a program that reimburses Newtown in lieu of property taxes for state facilities like the Garner Correctional Center and Governor’s Horse Guard, and a 14.3 percent reduction in Education Cost Sharing (ECS), the damage amounts to $1,925, 249.

But the release comes with a strong caveat from Mrs Llodra, who is taking a watchful but not dire position on the matter.

“It is important to recognize that these are potential categories of reduction to be considered by the legislature,” she told The Bee. “It is very unlikely that all of these reductions would take place, but these are the areas identified as potential targets.”

On Tuesday, Rep Lyddy said everyone at the capital remotely involved with the negotiations between the governor and the state unions were “tight lipped.” But the lawmaker did acknowledge that the governor was poised to throw the switch activating Plan B on or before May 31, or activating some aspects of it depending on the final outcome of those labor negotiations.

The Associated Press reported that the first of 4,742 union and nonunion workers were notified May 10 that they face a possible layoff. More notices are expected daily over the coming weeks.

After talks on a possible plan to come up with the labor savings, including concessions, broke off late Wednesday night, a union spokesman said his leaders were still trying to prevent almost 5,000 layoffs and deep cuts in state services.

The governor’s office promised to release a definitive list detailing the number of layoff notices already in process sometime May 12, which was not available when this issue went to press.

Rep Lyddy said the Plan B alternative could force everything from the closure of prisons to significant state workforce reductions, possibly compromising the ability of some state departments to continue delivery of services.

“Think about everything that Newtown is dealing with right now with just the monitoring of certain conditions by the Department of Environmental Protection [DEP]. And imagine how a ten percent reduction in DEP workforce will impact that effort,” Rep Lyddy said. “I hope concessions are made, or we’re unfortunately going to see a whole lot of blood coming out of the state workforce — union and nonunion.”

He said the ultimate responsibility of implementing reductions if labor concessions are not reached falls on the legislature.

“If negotiations fail, the governor will present his final plan to us by May 31, and the legislature will have until June 8 to codify the governor’s plan or craft a plan to deliver the same results with different cuts,” Rep Lyddy said, adding that Mr Malloy is committed to no further tax increases.

“If we come back with more taxes, Malloy has telegraphed that he will veto them,” Rep Lyddy said.

“The decision to cut deep with a scalpel versus stabilizing the patient first lies with state unions right now,” he said. “I would prefer to take a longer term approach at fixing the structural issues in state fiscal policies while we stabilize the patient. Plan B is a numbers decision. To me, that’s not good government.”

As for Newtown’s local budget, the selectmen’s request, without debt service, stands at 0.25 percent increase from last year, some $65,000, Mrs Llodra said. Positions have been eliminated, programs and services have been reduced, some capital items have been eliminated, and many departments are taking on additional responsibilities. 

“The Board of Selectmen provided these modifications in order to meet the action of the Legislative Council to reduce our budget by more than $330,000,” the first selectman said. “Our challenge has been to balance the community’s need for services against the cost for those services in a distressed and anxious economic environment.”

Mrs Llodra said the Board of Selectmen respect the work of the council and especially value the response of the voters.

“Having made a significant reduction, we ask that Newtown voters carefully consider our request for support and vote Yes in the referendum on May 17,” Mrs Llodra said.