NAUGATUCK — The borough’s 2016-17 budget went into effect Monday after no one stepped forward to petition to send the revised spending plan to a referendum.
The nearly $120.9 million budget increases spending by about $5.5 million, or 4.87 percent, over the 2015-16 budget. The budget increases the mill rate 2.1 mills, or 4.6 percent, from 45.57 to 47.67.
One mill equals $1 for every $1,000 of assessed value. Under a 47.67 mill rate, a home assessed at $150,000 will pay $7,150.50 in taxes, an increase of $315.
The municipal budget is $59.2 million, which is an increase of $5.5 million, or 10.28 percent over the 2015-16 budget. The Board of Education budget is $61.6 million, which is flat compared to 2015-16 school spending.
The budget is an increase of approximately $930,000 over the original proposed budget residents voted down at a referendum in July. However, the mill rate under the revised budget is 2.07 mills less than the first budget.
The driving force behind the increase in spending and the decrease in the mill rate increase is the borough’s settlement with Veolia North America, which runs the borough’s wastewater treatment plant. The agreement, which was reached after the first budget was adopted, meant additional revenue in the form of rent paid by Veolia and additional expenses to meet federally-mandated upgrades to reduce pollutants emitted from the plant.
“We resolved our contract dispute with Veolia resulting in the resumption of rent payments of $3.4 million per year. This fact alone saved in excess of two mills on the 2016-17 budget,” Mayor N. Warren “Pete” Hess said.
Along with the expense of bonding to make upgrades at the plant, the budget also begins to make payments on the $81 million Naugatuck High School renovation project. In total, the debt services budget is increasing by about $2.5 million, or 55.7 percent.
The borough also lost $975,000 in state aid, according to Hess.
Overall, Hess said the budget begins to solve many of the issues the borough has been facing.
“My strategy from day one was to stop kicking the can down the road and to squarely face the problems of the borough in my first budget,” Hess said. “All in all, the budget addresses the problems facing the borough and gives us the opportunity to pursue a host of revenue generating projects for the future. I am spending most of time now working on increasing the revenue side of the equation for next year’s budget. The best course for the future is to grow and increase revenue.”