Derby Mayor Rich Dziekan addresses the crowd during an inauguration ceremony in December 2021.
DERBY — Mayor Rich Dziekan has asked city department heads submitting budget requests to keep any increases to no more than 2.5 percent.
It’s part of what Dziekan called the “Taxpayer First Budget Initiative” in a letter to department leaders.
“Moving forward, budget requests, which are due to the finance director no later than Jan. 31 for inclusion in the mayor’s budget, will be evaluated using two metrics,” according to the letter. “The first is grand list growth. The second is the Consumer Price Index (CPI), an economic indicator demonstrating the growth in spending nationwide.”
The letter then states the lower of the two data sets is used as a spending cap in budget requests.
“The spending cap for the FY 2022 – 23 budget is 2.5 percent,” according to the letter.
Traditionally in Derby, department heads — whether it is the police department, public works or the school district — appear at budget meetings of the Derby Board of Apportionment and Taxation to make budget requests. The process usually starts in January and continues until BOAT (also called the “tax board”) votes to set bottom line dollar amounts for city expenditures, revenue, and the mill rate. That final vote usually happens at some point in May.
However, voters approved a charter change in November 2020 that inserted the mayor into the annual budget formation process. The change mandates the mayor to submit a city budget to the tax board by March 1 — but leaves the power to vote on expenditures, revenue, and the mill rate with the tax board.
The 2020 charter change also changed the deadline by which the city has to approve a budget. The deadline had been the last business day in May — now it is the last business day in April.
That early deadline complicates the budget process because Derby, an economically distressed city, relies heavily on state aid. The state has later budget deadlines, which Derby officials say makes budgeting for state aid a bit of a guessing game.
During last year’s budget process for the budget currently in place, the tax board opted to count on a $1.2 million state grant it ultimately did not receive, though the city had been warned the money was not guaranteed.
The mayor’s letter to city department heads warns against assuming state money is on the way.
The city’s early budget deadline, combined with the state’s later budget deadline, “means increases in (state aid) may not materialize and therefore should not generally serve as a basis for increases in spending.“
The letter also states outside agencies that receive funding from the city will be required to supply financial statements. The Derby budget includes a section called “citywide agencies,” from which the city gives relatively small amounts of money to groups such as Team Inc., the Boys and Girls Club, and others. The letter states nonprofits will have to submit a 990 tax form, along with a written request for funding.
“I realize this “Taxpayer First” approach to budgeting may result in tough decisions needing to be made. But, increasing the mill rate to support increases in city spending is simply unsustainable, will negatively impact our city’s bright future, and therefore needs to be avoided,” the letter concludes.
Whether Derby departments will be able to comply with the mayor’s 2.5 percent spending request remains to be seen.
Last year Derby Public Schools requested a 3.3 percent budget increase to cover contractual obligations — but ultimately received $1 additional from the tax board.
Derby Police Chief Gerald Narowski has repeatedly said the state’s police accountability bill has created a financial strain within the department, and will continue to do so moving forward. Narowski has specifically pointed to increased costs for items such as steroid testing and accreditation requirements.
Last spring the tax board voted to lower the mill rate from 43.8 to 38.6 — but the move, because of property revaulations, did not signify tax cuts for all property owners in Derby.
The city recently had its bond rating upgraded, a sign of better fiscal health after previous budget mistakes left the city reeling.
