Aldermen Approve $278M Budget 9-6 Along Party Lines; Mill Rate Set at $28.67

Democrats cite "tsunami" of cost pressures and increased state aid; Republicans say the majority had the math to cut deeper

MILFORD — The Board of Aldermen approved a $278,097,614 city budget for fiscal year 2026-2027 on Thursday night, setting the new mill rate at $28.67 and ending months of department hearings, public testimony, and caucus deliberation. The final vote was 9-6, with all nine Democrats voting in favor and all six Republicans voting against. A companion ordinance establishing the mill rate passed on the same 9-6 split.

The budget passes against the backdrop of the state-mandated 2025 revaluation, which the city is phasing in over five years and which has shifted a significant portion of the tax burden from commercial property owners onto residential property owners. Despite the reduction in the mill rate, most Milford homeowners are expected to see their actual property tax bills rise.

What the Budget Does

The approved budget authorizes $278,097,614 in appropriations against $278,097,614 in revenues. Taxes to be raised total $239,332,207. The remaining revenue comes primarily from state aid, which increased by approximately $1.1 million above the Board of Finance recommendation following the recent state budget agreement in Hartford, for a total of roughly $13.14 million in state grants.

Finance Director Peter Erodici told the board the additional state aid alone would account for "approximately a little over 0.1" mills of reduction in the rate, though he declined to project a final figure until the full budget was adopted.

State Representative MJ Shannon (D-117), who sits on the legislature's Finance committee and represents portions of Milford, Orange, and West Haven, was credited by Mayor Richard M. Smith with securing an additional $90,000 in state funding for the Milford Senior Center.

The Amendments That Passed — and the One That Didn't

Three substantive amendments were offered from the floor.

Alderman Raymond Pacelli, Jr. (D) moved to eliminate three unfilled positions — two truck driver positions in Highway and Parks and one truck driver position in Solid Waste — for a combined reduction of roughly $188,861 in personnel costs. Both amendments passed unanimously, with Republicans joining Democrats in support of cuts to unfilled positions.

Alderman Winthrop Smith III (R) then moved to amend the Finance Department budget to increase salaries for four specialist positions — a purchasing specialist, two accounting specialists, and a treasury finance specialist — from $56,407 to $73,144 each. Smith characterized the amendment as a "relatively de minimis" $66,948 increase on a budget of $278 million, aimed at preventing what he described as a risk of losing those positions in a competitive labor market.

The amendment failed 8-6 on what was effectively a party-line vote. Every Republican present voted in favor; every Democrat present voted against. Alderman Anthony Lombardi (D) had not yet arrived for that vote.

A fourth amendment, offered by Alderman Brian Bevan (R), proposed increasing the senior center's elderly nutrition contribution line from $1 to $30,000 for one fiscal year. After clarification from the Mayor that the $90,000 in newly secured state funds would flow directly to the senior center, Bevan withdrew the motion.

Two Competing Narratives

In closing remarks before the final vote, Alderman Smith III invoked Chairman Phil Vetro's opening appeal to "transcend politics."

"Two amendments that were proposed by the Democratic Caucus, and that was passed unanimously. Transcend politics," Smith III said. "I propose one amendment. For $66,000, for four positions ... $66,000 on a $278 million budget, and it gets voted down on party lines? That's not transcending politics. That's playing politics."

Smith III also criticized the use of approximately $12 million from the unassigned fund balance — the so-called "rainy day fund" — to balance the budget, calling it "irresponsible" and warning that it could affect the city's bond rating. "Last year people were appalled that we were taking $5 million," he said.

Alderman Winthrop Smith, Jr. (R) made the broader fiscal argument against the budget. "What the average homeowner in Milford is going to have, if this budget passes, is a tax increase. Not a small tax increase, but a fairly substantial tax increase," he said. "Voting for this budget is a vote for raising taxes." He noted that the current administration had campaigned on lowering taxes.

Alderman Andy Fowler (R) tied the local outcome to broader patterns: "I've never voted yes for tax increases, and it would break character to do so now ... I think we need more bipartisanship because then we can really address the real cost drivers."

For the Democratic majority, the case was made primarily by the Mayor and Alderman Paul Healy.

Mayor Smith, in his opening remarks, described "unprecedented cost pressures" he said he inherited upon taking office in November: contractual increases of more than $6 million in healthcare claims, $3 million in salary contracts, and roughly $1.08 million in other salary and benefit obligations. "It's really kind of a tsunami of costs, unprecedented," he said. The administration responded with a fourth-quarter spending and hiring freeze, a five-year phase-in of the revaluation, and cuts of "over $3.5 million in department-requested fund increases."

Alderman Healy framed the budget as the responsible product of difficult circumstances and signaled that other operational needs — including the Finance Department, MIS, and code enforcement — could be addressed in future budget cycles. "Under his leadership," Healy said of Mayor Smith, "he's able to utilize certain tools that are there, which is the unassigned balance fund, the investment account funding, and also through the finance director, enforce the encumbrance accounting system that we do have."

The Structural Reality

Under Milford's charter, the Board of Aldermen has broad authority to reduce or eliminate line items from the mayor's proposed budget, though it is more constrained in adding new spending. With Democrats holding nine of the fifteen seats, the majority caucus had the unilateral power to propose and pass additional cuts at any point during Thursday's session.

The amendments that did pass — Pacelli's elimination of three unfilled positions — illustrate that point. Those cuts came from a Democratic alderman and totaled roughly $188,861 in savings. Beyond those, no additional reduction amendments were offered by either caucus.

The single amendment that would have added spending — Smith III's Finance Department increase — was defeated by the Democratic majority. No Democratic alderman proposed an offsetting reduction elsewhere in the budget.

The $12 million draw from the unassigned fund balance referenced by Smith III, the five-year revaluation phase-in, the $3.5 million in cuts to department requests, and the final $239.3 million tax levy all reflect choices made by the majority. Republicans were able to register dissent through their votes but did not have the math to alter the outcome.

The budget takes effect July 1, 2026. First-installment tax bills based on the new mill rate are due July 1, 2026, with the second installment due January 1, 2027.