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08/18/2017

Gov. Malloy Announces Revised Executive Order Resource Allocation Plan

(HARTFORD, CT) – Governor Dannel P. Malloy today announced revisions to the Executive Order Resource Allocation Plan, along with new municipal aid distributions associated with the plan. The changes accommodate the restoration of $40 million to private, nonprofit health and human service providers, prioritizing education funding to communities with the highest student needs by holding harmless the 30 Alliance Districts, and $60 million of other adjustments that must be made to ensure that the state lives within its limited means under the executive order.

The revised plan and municipal aid estimates will be the basis for state spending for Fiscal Year 2018 in the unlikely event that a state budget is not enacted. It is intended to provide municipalities, providers, and state agencies with some certainty about what funding to expect until a budget is adopted.

“In the absence of an adopted budget from the General Assembly, my administration is reallocating resources to pay for basic human services, education in our most challenged school districts, and the basic operation of government,” Governor Malloy said. “The municipal aid that is funded as part of this executive order reflects the nearly impossible decisions Connecticut must make in the absence of a budget. It will force some of our municipalities – both large and small – to make similarly difficult choices of their own.”

In order to restore $100 million, the administration made the following changes:

  • Allocating the Special Education Excess Cost Sharing Grant at approximately the Fiscal Year 2017 levels.
  • Providing $1.46 billion in Education Cost Sharing (ECS) grants to the communities with the highest student needs and the greatest reliance on state funding. It holds the 30 Alliance Districts harmless and provides a grant equal to the Fiscal Year 2017 level. On average, 22.24 percent of municipal expenditures are funded with revenue from the state. The 54 non-alliance towns with a greater reliance on state funding, above the 22.24 percent statewide average, will receive a portion their Fiscal Year 17 ECS grant, and the 85 municipalities that have a lower reliance on state funding will receive no ECS grant. A total of 25 percent of the ECS payments will be made in early October.
  • For Municipal Revenue Sharing (MRS), grants of $40.6 million will be provided to municipalities for the tax loss resulting from a 37 mill rate cap on motor vehicle property taxes. This grant will be paid in mid-October when there are sufficient revenues in the MRS Account. At this time, no grants for the Additional Payments in Lieu of Tax Grants or Revenue Sharing Grants will be made from MRS.

The Governor continued, “This has never been my preferred path. I have proposed full balanced budgets and also short-term solutions that would alleviate some of this pain. It is incumbent upon state leaders to come together and reach an agreement on a biennial budget right away.”

In June, in the absence of an adopted state budget or even a stop-gap mini-budget that would have allowed the state to proceed with an appropriations act, a capital budget, revenue changes, and necessary legislative changes, Governor Malloy released an Executive Order Resource Allocation Plan. Under the limited powers of executive authority, the plan could not change statute, alter revenue, or deviate from existing legal covenants, but could only allocate resources based on availability to satisfy the most pressing obligations on the state.

Due to these constraints, approximately $100 million in payments to private nonprofit providers who provide services across DSS, DDS, DCF, DMHAS, DOH, DOC, DORS, SDA and Judicial were cut. Unfortunately, the providers have not been able to withstand these cuts without unacceptable cuts in services. In response, the administration will restore $40 million to continue funding vital services to our most vulnerable residents. Additionally, there were another $60 million in expenditures that needed to be restored to ensure adequate resources to meet state obligations.

**Download: Revisions to the Executive Order 58 Resource Allocation Plan and Town-by-Town Municipal Aid Data
**Download: Municipal Aid Summary

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