Malloy Would Reduce, Dramatically Redistribute School Aid In October

By Keith M. Phaneuf and Jacqueline Rabe Thomas | August 18, 2017

Gov. Dannel P. Malloy would reduce grants to school districts by 28 percent in October — if no state budget has been adopted — and would dramatically shift funding away from wealthy and middle-income communities and into poorer ones.

Absent a new two-year budget, the governor’s plan would eliminate Education Cost Sharing funding entirely for 85 school districts and reduce funding somewhat for another 54. Grants to the 30 lowest-performing school systems, also known as Alliance Districts, would remain unchanged.

The governor, who released an updated plan Friday for running state finances by executive order, also announced he is in the process of restoring $40 million out of $100 million in reductions made since July 1 to private, nonprofit social services.

Scaling back cuts to nonprofits

The governor also acknowledged that private, nonprofit social services have been under particular strain since the new fiscal year began more than seven weeks ago without a new budget in place.

Connecticut spent about $1.3 billion last fiscal year hiring community-based nonprofits to provide the majority of social services offered to the disabled, the mentally ill, abused children, the poor and others.

And while administration officials have called this work critical, they also note that funding for many programs are limited by available resources.

“We talk about municipalities having fragile finances,” the governor said. “The vast majority of the not-for-profits we’re dealing with have far less ability to respond” to the financial crisis.

Malloy said that while resources for nonprofits were reduced by $100 million shortly after July 1, his administration is restoring $40 million of those funds.

“If we don’t make these adjustments a number of them will go out of business or cease to perform” services for those most in need, he added.

The administration found the $40 million for nonprofits, and another $60 million to show up a variety of other programs and accounts in the budget, by redirecting funds from education and special education grants for school districts.

Gian-Carl Casa, president and CEO of the CT Community Nonprofit Alliance, said the social services safety net has been under-funded for more than a decade, “causing layoffs and directly impacting people with developmental disabilities, mental health problems, substance abuse issues, people returning to their communities from prison, and others. But while the restored funds will help buffer or delay some of the most devastating impacts of the budget stalemate, it is not a substitute for a biennial budget. … Connecticut’s residents are in this together and we all need a budget that fully addresses the state’s budgetary needs, including human services and education.”

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