New London, CT Runs Risk of Bankruptcy
The finance director of New London, Connecticut says the city could run out of money in the coming year because it has no financial cushion. WAMC’s Lucas Willard has more…
According to The Day of New London, Finance Director Jeffrey Smith says no department may overspend its budget and New London must collect all the revenue it expects in the current budget year that ends next June.
New London has $312,000 in its fund balance.
Smith says city departments had overspent the budget and the city collected less revenue than it estimated.
The executive director of the Connecticut Conference of Municipalities, James Finley, says most towns in Connecticut try to keep at least 5 percent of budgets in a fund balance, but can't reach that goal as they' try to keep property taxes down.
He says education costs are rising and state support is decreasing.
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