With only a few months left in his tenure as mayor of Hartford, Luke Bronin moved Connecticut’s capital city to a lower level of state oversight during a meeting of the Municipal Accountability Review Board (MARB). The MARB voted in favor of a resolution to move Hartford from Tier III oversight to Tier II oversight following a request by Bronin.
Hartford had been under Tier III oversight by the state of Connecticut since 2017 when the review board was established by the legislature and Hartford was facing possible bankruptcy. The MARB is a board of government and private sector individuals appointed to oversee the finances of towns and cities that have become financially unstable.
The financial state of the municipality determines the tier of oversight placed on the city or town, with the highest level of oversight being Tier IV, a distinction only held by West Haven at the moment.
Bronin sent a letter to the MARB and spoke in person during the October 17 meeting, indicating that Hartford has done everything necessary to remove it from Tier III oversight and requesting MARB officially designate the city as Tier II.
“I was a strong advocate for the creation of the MARB and a strong proponent of the city of Hartford’s participation in the MARB process,” Bronin said, after recounting the dire fiscal situation he inherited. “I believe that we have budged with rigor and care and discipline, and I think that’s reflected in multiple years of surplus as well as the improving fund balance and continued positive outlook.”
Bronin said that he believes Hartford could conceivably exit MARB oversight altogether, but he is requesting Tier II oversight in order to continue having Hartford’s finances reviewed by the state and said that working with MARB has been overall positive for the city.
“Our progress is very real and fragile, and I think it needs to be protected and it needs to be defended with similar rigor and discipline in the years going forward,” Bronin said. “But I do believe it’s appropriate at this time to redesignate the city of Hartford. We have, I think, clearly met the conditions for being taken out of MARB Tier III supervision.”
Hartford’s finances have seen a turn-around, starting with a controversial $550 million bond bailout by the General Assembly and orchestrated by Gov. Dannel Malloy in 2018 in which the state took on a sizeable chunk of Hartford’s debt. The city was also bolstered for five years by contributions made by some of the city’s largest employers – namely insurance companies which contributed an extra $10 million per year to the city.
The General Assembly also reworked its payment in lieu of taxes (PILOT) grant formula to distribute more money to municipalities with large areas of state government or nonprofit buildings. For years prior, lawmakers had cut back on PILOT payments, leaving cities in particular hurting for property tax revenue they can’t collect from government buildings and nonprofits.
Hartford’s improving finances and financial outlook caused the city’s bond rating to be moved from Ba2 to Baa3 by Moody’s with a stable outlook, making the city’s bonds investment grade. During a previous meeting of the MARB, MARB board member Thomas Hamilton commented that the improvement was “a really big deal,” and that the city and the board should recognize this accomplishment, according to the meeting minutes.
Under Tier II status, Hartford will still have to provide financial information, present a three-year plan, have their budget assumptions approved by the board and report on remedial action recommended by the board. But the change in status means the city will no longer have to review labor contracts, arbitration awards and debt obligations with MARB.
The board was supportive of the request, passing it unanimously and complimenting Bronin on his oversight of the city’s finances. MARB chairman Jefferey Beckham of the Office of Policy and Management (OPM) said statutory language is a little unclear as to exiting tier status, but the board can make this recognition.
“Should conditions warrant in the future, we can make other arrangements about what tier they should be in, but that’s our best read on what the statute lets us do,” Beckham said, noting that he appreciates Bronin’s request to only change status rather than exiting MARB completely.
“As one who was deputy secretary at OPM when you were elected and worked with you on what your options were and was involved in the creation of MARB, I just wanted to congratulate you,” said board member Susan Weisselberg. “I think this proposed move reflects your leadership and significant state support as well over the years.”
“I think the progress that Hartford has made under your leadership, mayor, and with assistance from this board really has been remarkable and important for the state of Connecticut and the city of Hartford,” board member Thomas Hamilton said.
“I think this is an appropriate recognition of the progress that we’ve made as a city and also I think clear under the statute that it is time for the de-designation of the city as a Tier III municipality,” Bronin said.