Council Undoes Budget Veto

The Common Council voted along strictly partly lines Thursday evening 8 to 3 to reinstate the budget they adopted on May 14. Mayor Sebastian Giuliano vetoed the budget, and the Council needed 8 votes to reinstate.

The $129.7 million budget assumes no increase in taxes and limited cuts of programs. The mayor's counter budget of $128.5 million was based on a 1 mil tax increase.

The Democratic council members contended that the city is healthy financially, with new revenue streams, one-time revenue sources and a more-than-solvent general fund. The mayor, and Republican council members noted that none of the revenue sources is guaranteed, and that counting on money not in hand is risky.

Part of the budget is the return of a fireworks celebration, something that was cut out of the mayor's version of the budget, but there were plenty of fireworks during the official meeting with some louder explosions once the meeting was finished (more on that in a separate post).

The debate began when Council member Gerry Daley questioned the basis for the Mayor's veto of the budget. He questioned the Mayor's contention that a nearly $2.6 request to settle retro salary increases based on the police union contract was an "unexpected" expense. He also wondered why the mayor was projecting revenue problems, like the loss of the Aetna facility from the tax rolls, which would not hit the budget until the following fiscal year.

The mayor explained that the $2.6 million would have a draining effect on the general fund, and that his job was to consider not only the current tax year, but the tax burden in successive year as negative impacts hit the budget.

Daly was the first of several Democratic Council members to emphasize that the budget they were proposing was one which avoided a tax increase, and a cut in services.

"These are not ordinary times," Daly said. "And that's why I think taxpayers need a break.'

Umbrage began to be taken in large proportions when Council member David Bauer asked a series of questions, which were required by Roberts Rules of Orders to be "rhetorical." He wanted to know why a compromise budget, offered by the mayor, which would have had no tax increase, and an additional $800,000 in savings was rejected. He also asked if the Council's rejection of a negotiated "no layoff" clause with unions meant that the Council was expecting layoffs to be part of the budget solution.

In a short diversion where the rules of order were discussed heatedly, charges were traded.

"This is not a dictatorship," Daley said of one of Giuliano's rulings as chairman of the meeting. "This is a democracy."

Answering Bauer, Majority leader Tom Serra charged that Bauer was using scare tactics.

"You did the same thing last year," Serra scolded. "Layoffs, layoffs, layoffs. This budget is going to work and there will be no layoffs."

All the Democratic members painted a rosy picture of the the City of Middletown's financial health. They pointed to revenue from the sale of Cucia Park, and to expected tax revenue on the opening of the Kleen Energy plant. Both Serra and Daley mentioned that they expected no problems with bond ratings. Daley indicated that even after expenditures the general fund would be at a level higher than five years ago.

"There are a lot of things going on in town on the positive side," Daley said. "We owe it to the taxpayers of Middletown to give them a break this year. What is Middetown if we don't have the quality of life. We the Democrats stand united for no tax increases."

Council member Vinnie Loffredo chastised the mayor for the first budget sent their way. He noted that union concessions were tied to specific cuts.

"That was totally unacceptable," Loffredo said. "How were we going to go through that (budget) process under those pressures. Those threats. Everyone of the concessions was linked together. It was a house of cards."

Loffredo conceded that the mayor and the unions later unlinked the concessions to specific budget cuts.

Bauer wouldn't let a vote be called without a final warning.

"This budget raises the specter of layoffs," he said. "The numbers don't lie. Last year this Council cut by one third what the mayor had proposed as projected spending. Then the council ended up spending every cent of the third they had cut, and beyond."

After a final rebuttal by Gerry Daley, a vote was called, the veto was rejected, and the Council voted to adjorn.

Common Council To Vote on Vetoed Budget

The Common Council will conduct a special public meeting Thursday at 7PM to vote on overturning a veto of the budget by Mayor Sebastian Giuliano.

While both sides met to discuss the budget, the resolution reads as follows:

In Accordance with Chapter VI, Finance and Taxation, Section 1 of the
City Charter, readopting all items that were vetoed in the 2009 – 2010
budget and that said budget be effective as adopted by the Common
Council at their meeting of May 14, 2009 at 7 p.m

In an email to a Middletown Eye contributor Mayor Sebastian Giuliano writes:

" Carl Erlacher, Diana Doyle, Tima Bomes, Debra Milardo, Geen and I came up with a proposed compromise that would ahve saved as much as $800K by keeping the union concessions in play, making some cuts (while preserving the great majority of their pet project spending) and using considerably less of the Cucia Park projected proceeds. Word is that the majority caucus is just going to override my veto and keep their own budget."

The Citizens Advisory Committee met Wednesday evening, and as a result of stimulus dollars provided to the city, restored funding to several organizations who had seen their annual contributions cut drastically or completely. If the Common Council takes the advice of the Citizens Advisory Committee, the St. Vincent DePaul Amazing Grace Pantry, which had been set to receive no funding, will now receive $6000 for the Pantry, and $10000 to perform a relocation study for their soup kitchen. In addition the Chamber of Commerce will move from $8000 to $19,0000.

Mayor's Veto May Result In Compromise

As reported earlier today, Mayor Sebastian Giuliano vetoed the city budget proposed by the Common Council last Thursday.

In a written statement accompanying his formal veto, the Mayor listed five specific reasons for rejecting the budget. He indicated the Council might be unaware of a $2.6 million appropriation from the reserve fund to adjust Police salary and overtime as a result of collective bargaining agreements. He also noted a $1.8 million dollar decrease in revenue in the next fiscal year due as Aetna prepares to move its operation out of Middletown. In addition, the mayor points to nearly $100,000 in revenue overprojections he feels the Council has made in real estate tax revenues and licenses. The mayor also feels that the projected sum of $1.5 million dollars for the sale of Cucia Park to the Army is misguided. Finally, he feels that projected savings from "voluntary concessions" is unrealistic after the Council rejected the union concession package.

"I cut spending as far as I could cut," the mayor said in an interview this afternoon. "I negotiated a million dollars in concessions from city unions, and I could only get the budget down to a 1 mil tax increase. The Common Council added all the cut spending back. They spurned the $1 million in concessions, and they proposed no tax increase. Where's the money coming from."

After hearing criticism from his Democratic opponent in the mayoral race Giuliano indicated that the tax increase of 1 mil is a minimal increase.

"It's an average of $160 a year per household," the mayor claimed. "That's four dollars a week for the average taxpayer. You'd give up a cup of coffee and a donut a week. You don't want to give that up, and in return you'll choose financial chaos in the next fiscal year."

Democratic majority leader Thomas Serra, who had only just reviewed the mayor's veto and counterproposal, was cautious in his assessment.

"We'll caucus and discuss it," Serra said. "It looks like he's proposing a 25.5 mil rate, which is no increase. If that's the case, it will be how comfortable the caucus is with the lateral changes. We thought the mayor's cuts were completely responsible, but we were worried about the disparity in furlough days in the different unions, and the loss of funding for Police officers. We believe the citizens of Middletown cannot bear an increase in tax payments."

The mayor also indicated there might be room to compromise.

"If we all sit down we might be able to find a way out of it," the mayor said. "But if you say you're fiscally responsible you can't use a one-time cash receipt to help solve a problem that will come back year after year. You know who deals with it in the end - the taxpayer."

This is the second time the mayor has vetoed a budget. Last year he objected to the use of projected funds from the sale of the Remington Rand building. That sale did not occur as planned.

The Common Council can override the mayor's veto with a two-thirds vote of Council members. The Council has 10 days to consider the veto and call a meeeting to adjust the budget. The Democratic members plan to caucus immediately to consider the veto and possible adjustments to the budget.

Democratic Mayoral Candidate Dan Drew Reacts To Budget Veto

Press release from Dan Drew, Democratic Mayoral Candidate

Mayor Vetoes Budget Proposed By Common Council

Mayor Sebastian Giuliano has vetoed the budget proposed by the Common Council. Giuliano filed the veto today. Details to follow.