Financial Audit Prevents State Takeover Of New Britain's Finances

Over the past two weeks, Mayor Stewart released information stating that an official audit of the City’s financial situation revealed that the City was in a financial crisis, to wit, a deficit of approximately $23.4 million. In O’Brien’s 2013-2014 Budget projected revenues from all sources would not be enough to pay the City’s bills through June 30, 2014. Also, the City was close to reaching its bonding cap - our ability to sell our debt - by only $13 million, a red flag to our bond rating agencies. The bond rating agency might  lower our rating by five categories. In addition, if New Britain could not find a way to bring its fiscal house in order, the City was facing a State takeover of the City’s finances.

What to do? Mayor Stewart and her financial advisors put together a plan to rescind $23.4 million dollars worth of the bonded indebtedness and purchase $25 million worth of Tax Anticipation Notes (TANs). The 2013-2014 Budget under which the City is currently struggling was put forward by then Mayor O’Brien and approved by the Common Council. With one exception, Alderman Carlo Carlozzi (D), the 12 other Council Democrats voted to approve that budget. In fact, Herald Staff Writer, Robert Storace, in writing profiles of all Council candidates for the 11/5/13 municipal showed that 12 out of the 13 Democrats then on the Council praised O’Brien’s 2013-2014 Budget. Nine of those Democrats are still on the Council. It requires a two thirds yes vote (10) of the Council to approve bonding measures.

When the dust cleared Wednesday night, only a little more than 2/3 of the bond rescissions had been approved - one would have thought all would be approved to save the City. Fortunately, the vote to purchase the $25 million worth of TANs was approved. Had the TANs purchase been denied, the State would have taken over the City.  Keeping that in mind New Britain taxpayers must realize that the three irresponsible votes cast against buying the TANs were: Alderman and Council President Pro Tem Michael Trueworthy (D), Alderman David DeFronzo (D) and Alderman and Assistant Majority Leader Adam Platosz (D). What a scary thought when one realizes that The President Pro Tem takes over as Mayor if the Mayor is incapacitated.

Louis G. Salvio, Alderman