HARTFORD -- City leaders have taken a step toward bankruptcy, looking into options and proposals from law firms that specialize in Chapter 9.
Mayor Luke Bronin confirmed to FOX61 that the city in preliminary stages in looking into options for legal council on the matter, but that they hope to avoid filing for bankruptcy. The city is asking for the state's financial support to ensure bankruptcy isn't in the city's future.
City councilor John Gale also told FOX61 this is a preparation move should their first plan to fill a growing gap in the city's budget not pan out.
“Plan A, the mayor’s come out with a budget which calls for a state partnership, we’re looking for the state of Connecticut to come up with 40 million dollars," Gale said, but added if that doesn't happen in a sustainable way, filing for bankruptcy could be on the horizon.
“I certainly hope we don’t have to go there, it’s not my first choice it’s not my second choice, I don’t think this will be a good day for the city of Hartford, I don’t think it will be a good day for the state of Connecticut," Gale said.
He also explained the city's money troubles come from a variety of reasons including problematic structuring with the city's grand list, underfunded payments from the state, and past leaders making one-time fixes along the way to fill the budget deficit gaps.
“It (the city) receives reimbursements from the state of Connecticut, 51% of our property is non taxable and because it’s not taxable we get payments in lue of taxes from the state, as we should, but those payments are vastly underfunded. So again it puts us at a disadvantage," Gale said.
He and other city councilors also expressed concerns about what filing for bankruptcy would mean for the capital city and for the state, saying it would deter businesses from setting up shop in Hartford, or drive current business away causing a domino effect to the greater Hartford region.