The Bridgeport Financial Review Board gave final approval last week to the Connecticut city's new three-year financial plan and five-year capital improvement plan.
Over the past five years, the oversight board has demanded changes each time the financially troubled city has put forward a spending plan. But this time members said city officials have created a responsible framework for fiscal progress over the next few fiscal years.
The $339 million budget for fiscal year 1994 received approval from city government late last month. Approval by the 11-member control board, which is drawn from the city's government and the state Office of Policy and Management, has been the final step in the process since 1987.
Jerome I. Baron, Bridgeport's finance director, said the control board unanimously approved the budget plan at the Thursday afternoon meeting.
"This marks the first time the control board and the city administration have come to an agreement on the budget, " Baron said. " There were no major changes from the preliminary plan."
The budget plans for fiscal years 1995 and 1996 were based on numbers used in the 1994 budget. The control board voiced some concerns about those estimates, but members said they were satisfied with the numbers as a guideline for the next two years.
"The last few years, the board had some serious concerns about the city's plan and that was why we rejected the last few plans," said Linda Savitsky, executive director of the 11-member review board. "We will still review the city on a monthly basis, but we are encouraged by their performance. "
Former Mayor Mary C. Moran filed for bankruptcy in June 1991 but the petition was rejected by the U.S. Bankruptcy Court. Before Moran could appeal the decision, she was defeated in the November 1991 election by current Mayor Joseph Ganim.
Ganim withdrew the appeal immediately following his inauguration.
"I think that this process shows a renewed credibility between the board and my administration," the mayor said in an interview on Friday. "It's a tremendous signal for the people of Bridgeport."
Although the Ganim administration has made strides, the control board said there were still some revenue concerns.
In the final budget plan for fiscal 1994, for example, some revenues were shifted from one fiscal year to another, and some other revenue estimates were lowered.
City officials are currently receiving quotations on construction of a sludge-treatment facility in the city.
Baron said that construction of the facility is "a good year away," from beginning.
In the initial plan, the city predicted it would begin to realize revenues from the plant during fiscal 1995. But Baron said the city has moved that back to fiscal 1996.
"We're still getting estimates on the cost of the facility, so it's premature to speculate on the cost," Baron said. "But the plant will mean millions of dollars of revenues once the plant is built."
Additionally. city officials lowered to $2 million from $15 million the estimated revenues in fiscal 1996 from leasing concessions and other services at the city-owned airport because the city plans to privatize management and operations of the airport.
During the late 1980s, Bridgeport's rate of uncollected taxes increased every year. Ganim said the biggest culprit has been D'Addario Corp., which for the past few years has paid no taxes on a large underground shopping mall that it owns in central Bridgeport.
Connecticut has recently pledged to buy the land and pay the back taxes to the city. State officials have said they will be constructing the Housatonic Community College on the property.
Although the land with the college will become tax-exempt, Bridgeport will continue to receive funds through the state's Payments in Lieu of Taxes program, which helps communities overburdened by tax exemption.
Lastly, the city will establish a $1 million reserve fund from the sale of the city-owned Beardsley Zoo.
At the same time, the board approved the five-year capital plan. But Savitsky said the key to any Bridgeport capital plan is to get the credit rating back above investment grade.
Ganim agreed that the Bridgeport's credit rating must be raised before the city can consider reentering the municipal arena.
"I think with the passage of this budget, we can start putting together our plan to go back to the ratings agencies," the mayor said.
Bridgeport is only slated to invest $2.7 million during fiscal 1994 on capital projects.
The city is currently rated Ba by Moody's Investor's Service and BB by Standard & Poor's Corp.
Savitsky said the city would like to sell $11 million for school renovations, but will have to regain its investment-grade status before the bonds will be accepted.
Ganim's first term ends this year and he has scheduled a press conference for this Wednesday, where he will announce whether he will run for a second three-year term.
Several sources said the mayor will announce that he plans to seek re-election.