In the last issue of the Drummer, it was reported that Standard and Poor—one of the key municipal credit rating agencies—had reaffirmed our rating at AA+. That allowed the town to recently borrow at a favorable rate of interest on its bonds (1.55 percent net). It also recognizes our carefully managed position of fiscal strength as a municipality, as well as the value and benefit of our longstanding practices of fiscal discipline and capital planning. Those have been the hallmark of managing the fiscal affairs of Granby government for decades.
A steady hand on the tiller has seen our credit rating improve by a couple of notches over the past 20 years. That was reinforced by strong bipartisan consensus on the Board of Finance, as well as consistent cooperation from both operating boards. Through very choppy waters including economic downturns, threats of withholding state aid by former Governor Malloy and the recent and not-yet-over pandemic, Republican-majority boards have effectively and efficiently met Granby’s needs while being sensitive to the financial impact on local taxpayers. At the same time, we have steadily increased our municipal fiscal strength as recognized by the bond credit rating agencies.
This has been accomplished with consistent, conservatively constructed annual budgets run in the black. By not spending every dollar budgeted and allowing the accumulated surplus to build we can utilize it when it makes fiscal sense. The transfer into the Other Post Employment Benefits trust fund at budget time this spring is an example. That decision removed an expense from the next four years of operating budgets by transferring money from a lower-yield bank account to one historically showing a much higher rate of return. We believe it’s best to take the long view in financial decision-making. Short-term gimmicks may feel good but come up short in the long run.
The better we manage revenues and expenses, the better we as a town can meet the needs of the citizens, children, and taxpayers of Granby. Those serving on the Board of Finance look to continue our work in keeping Granby strong, especially in these unique times. Our track record is a gauge of our effectiveness. As the saying goes, the proof is in the pudding, and the record speaks for itself:
• a decade of operating budget increases averaging below 2 percent
• a decade of effective tax rate increases averaging less than 2 percent
• maintaining the same mill rate for the third year, even as costs continued to grow
• holding a reserve of 15 percent of the budget, as recommended by the credit rating agencies
• pension obligation is nearly fully funded
• OPEB roughly 50 percent funded—markedly better than most Connecticut towns.
One of the greatest threats to this stability—and to operations—comes from those who feel that greater rates of spending are always better. Granted, costs go up year after year. Yet at the same time there are limits to what the taxpayers can come up with year after year. An individual told me a couple of years ago that they thought we are short-changing the taxpayers if we aren’t raising taxes 3-4 percent a year every year! That’s anathema to me, and my view is the exact opposite—we would be short-changing the public if we did that year after year!
There may be an instance when such an increase would be justified and, in that case, I would ask the taxpayers to consider it then—and only then. A steady diet of that would not go far, because in the end it is the taxpayers who vote Yea or Nay. There was a time when about every third year the budget was defeated. Those who forget the past are doomed to repeat it. We don’t need to step back in time, lest it also be a step backwards for Granby and to the detriment of the steady progress the boards have made in providing quality programs and services in recent decades.