New Haven mayor takes aim at nonprofits

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New Haven Mayor Justin Elicker revived an old municipal battle cry when he accompanied his fiscal 2021 budget message with a call for more contributions from nonprofits Yale University and Yale New Haven Health.

“It is time that you step up and make sure that you contribute to the city so that everyone in New Haven can have the opportunity to thrive,” Elicker said while releasing his first budget for Connecticut’s second-largest city.

A projected $45 million gap compounds the urgency, he told reporters.

“It is time that you step up and make sure that you contribute to the city so that everyone in New Haven can have the opportunity to thrive,” said New Haven Mayor Justin Elicker.

The $561.1 million spending plan, which the Board of Alders will consider through May, is up 2.2% from last year’s approved budget. It calls for a 3.6% tax hike and defunds 80 vacant positions, primarily for police and fire personnel. The $3.5 million increase in school spending represents only one-third of the $10.5 million extra the Board of Education sought.

Elicker, a Democrat, referenced the two institutions’ combined income of more than $7 billion.

The university and Yale-New Haven Health fired back with their own statements.

“We respect Mayor Elicker and understand that the budget pressures he is facing are real,” said Vin Petrini, Yale-New Haven senior vice president of public affairs. “However, today Yale New Haven Health is the largest taxpayer in Connecticut, paying more than $300 million a year.”

Petrini also said Yale-New Haven has provided $30 million in voluntary payments to the city over a decade.

“While I applaud [Elicker’s] desire to address the city’s budget deficit head-on, I do not believe that New Haven’s books should be balanced largely by Yale University writing dramatically bigger checks,” said university president Peter Salovey.

Elicker’s broadside on Monday marks the latest iteration in the longstanding "town versus gown" divide in 131,000-population New Haven.

The Democratic mayoral primary tussles in 1977 and 1979 between Yale-educated Frank Logue and former police chief Biagio DiLieto — each won once — reflected that schism. In recent years, however, the city and the institutions have collaborated on downtown revitalization, a science park and the redevelopment of state Route 34 to enhance biotech growth.

Moody’s Investors Service, in a July credit analysis, cited benefits to the local economy from the institutional presence of the university and the health center. By contrast, though, income and wealth levels are low and poverty rates are high.

Moody’s and Fitch Ratings last year revised their outlooks on the city’s general obligation bonds to stable from negative. Moody’s and Fitch rate New Haven GOs Baa1 and BBB, respectively, while S&P Global Ratings assigns BBB-plus, also with a stable outlook.

The city’s projected debt service for FY21 totals $59.8 million, or 10.5% of proposed general fund expenditures.

New Haven has also hired PFM Financial Advisors to perform a comprehensive review of the city’s finances. PFM has performed comparable services for other Northeast cities.

Shortly after his election, Elicker said applying for state oversight under the Municipal Accountability Review Board was also an option.

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