A Discussion of the Connecticut Supreme Court Decision Raised by
Town Attorney Jeffrey Donofrio to Argue for the
Legality of the Town's Budget Transfer Method

If you didn’t read the blog entry introducing this page, here it is (this is also where to go to make comments):

It is a serious thing to say that a Town Attorney, or any attorney for that matter, has misrepresented a court decision. What makes it especially serious in the case of a Town Attorney is that the Town Attorney’s client is the town, that is, us. Were he representing a client whose interest is in fooling us, someone whose interests were opposed to ours, then we would just say, "A job well done. You fooled the Annual Town Meeting  and won the vote."

But who could the Town Attorney be representing whose interests are opposed to the town’s, who’d want to fool the town into voting a certain way? That is the central question, I think, in the upcoming election.

The town of North Haven’s interest with respect to the legality of the budget transfer process is knowing whether it's legal or not. Mr. Donofrio told us it was legal, but to do that, he had to depend on a court decision that doesn’t say this. This is the best he could do.

He won the debate and won the vote, but we lost, because we didn’t know the truth when we voted, and those who watched the meeting on television were given a false impression of the court decision.

I owe it to Mr. Donofrio not simply to criticize him (as I did in a recent blog entry on the Annual Town Meeting), but to show in great detail where, how, and why he was wrong, and to allow him to respond in a comment to my blog entry.

I would not have spent so much time on this had I thought that Mr. Donofrio was simply incompetent. I know how intelligent and experienced a lawyer he is, and therefore I cannot believe that he was simply incapable of understanding the decision he presented to the Annual Town Meeting on September 25. No, he knew what he was doing. And he knew that if the budget transfers were seen as illegal, it would undermine the respect given to Republican management of the town and would jeopardize their re-election and, therefore, his own position as Town Attorney.

I believe that, due to Mr. Donofrio’s misrepresentations of the law, the budget transfers should be brought before the Town Meeting again. But I don't think this is likely to happen. This is not the way the Kopetz Administration works, not unless it is forced to. I also believe that Mr. Donofrio should apologize to the town for not being frank with us.

                            ______________________________________________

The Supreme Court decision is Board of Education v. Ellington, 193 A.2d 466 (1963). I have highlighted it so that you can quickly find the relevant passages.

Here is what Mr. Donofrio said about the decision in the speech he made at the September 25 Annual Town Meeting. Click to read a full transcript of what he said.

Secondly, my opinion, which is in disagreement with the prior recitation of what the speaker believes the law to be is based upon my reading of Connecticut Supreme Court case law, which discusses the legislative history behind the creation of the Contingent Fund and discusses the purpose of the board of finance and makes absolutely no reference whatsoever, inthis 1963 Connecticut Supreme Court case, which is still good law today, makes no reference whatsoever to Town Meeting approval of transfers from a contingent fund in the budget to cover other items.

In addition to the budget transfers you’re being asked to approve, there’s another $1 million in large budget transfers being taken out of the Contingent Fund. The Contingent Fund. The Contingent Fund is for contingencies, for emergencies, for special needs. It’s not just to cover things that happen to be spent. The language in the law is not very good, but it’s pretty clear that that is one of the places where, if you take money out of the Contingent Fund, the Town Meeting approves it.

And if there’s any doubt, why wouldn’t you come to the Town Meeting for their approval anyway? There’d be no harm to anyone, there’s no bother, we’re already here. But there’s $1 million in transfers over $20,000 that you’re not being asked to approve. You should know about that. That isn’t something they told you. It wasn’t in the newspapers, it wasn’t in the call for this meeting.

He refers to what I said I believed the law to be, and it’s clear from the context that this means the law on the Town Meeting’s role in approving transfers from the contingent fund. Here is what I had said about this, that is, what he was responding to (I spoke again later, but he did not respond to what I said). Click here to read a full transcript of what I said.

In addition to the budget transfers you’re being asked to approve, there’s another $1 million in large budget transfers being taken out of the Contingent Fund. The Contingent Fund. The Contingent Fund is for contingencies, for emergencies, for special needs. It’s not just to cover things that happen to be spent. The language in the law is not very good, but it’s pretty clear that that is one of the places where, if you take money out of the Contingent Fund, the Town Meeting approves it.

And if there’s any doubt, why wouldn’t you come to the Town Meeting for their approval anyway? There’d be no harm to anyone, there’s no bother, we’re already here. But there's $1 million in transfers over $20,000 that you're not being asked to approve. You should know about that.  That isn’t something they told you. It wasn’t in the newspapers, it wasn’t in the call for this meeting.

And finally, here’s the third piece of the puzzle, the state law on the subject. You can read the entire section, 7-348, by clicking here.

Sec. 7-348. Towns not to contract in excess of appropriations. Town meeting to increase amount. No officer of such town shall expend or enter into any contract by which the town shall become liable for any sum which, with any contract then in force, shall exceed the appropriation for the department, except in cases of necessity connected with the repair of highways, bridges, sidewalks and water and sewer systems and the care of the town poor, and then not more than one thousand dollars. If any occasion arises whereby more money is needed for any department of the town than has been appropriated as provided for in this chapter, the selectmen shall notify the board of finance of such fact, and the chairman of such board shall forthwith call a meeting thereof to consider the appropriation for such department and the board may make the necessary appropriation therefor, after inquiry, but, if, ... in towns where the grand list exceeds twenty million dollars, if the amount required or the amount required, together with the sum of any such additional appropriations, exceeds twenty thousand dollars, such appropriation shall not be made until, upon the recommendation of the board, the same has been voted by the town at a meeting called for such purpose, provided no more than one such additional appropriation for any one department shall be made in one year without town meeting approval .... The board may call a public hearing prior to the town meeting at which parties in interest and citizens shall have an opportunity to be heard so that the board may obtain information to assist in making its recommendations. The amount required for such appropriation may be drawn either from any cash surplus available or from any contingent fund established as hereinafter provided. ... The estimate of expenditures submitted by the board of finance to the annual town meeting or annual budget meeting may include a recommended appropriation for a contingent fund in an amount not to exceed three per cent of the total estimated expenditures for the current fiscal year. No expenditure or transfer shall be made from the contingent fund until such expenditure or transfer has been approved by the board of finance....

So before getting to the Supreme Court decision, here’s where we stand:

1. I said that the contingent fund is one of the places from which budget transfers are taken, and that for large transfers out of the contingent fund ($20,000 or more), Town Meeting approval is required. I followed the language underlined in section 7-348, which talks about large transfers being drawn from either a cash surplus or a contingent fund, and according to the statute, such transfers must be approved by the Town Meeting.

I referred to the language of the law as not being very good. What I meant is that the statutory section goes on to say that no such transfer from the contingent fund may be made without board of finance approval, which seems to go without saying, since it is stated above. The only reason that this could possibly have been restated here is that this part of the section is a description of the then new concept of a contingent fund, which was added to the section in 1953. This is clearly why the two parts of the section are not well connected, and why I referred to this situation in my speech, very honestly (I could have ignored it, as Mr. Donofrio ignored parts of the section in his speech), by saying that the language in the law is not very good.

2. Mr. Donofrio said that I was wrong, due to the decision of the Connecticut Supreme Court in a 1963 case, which, he said, "makes no reference whatsoever to Town Meeting approval of transfers from a contingent fund in the budget." This decision could be none other than Board of Education v. Ellington. I found no other Supreme Court decision that year that had anything to do with budget transfers and contingent funds.

Well, is Mr. Donofrio’s statement true? Does the Ellington decision have anything to say about Town Meeting approval of budget transfers from a contingent fund? He said it doesn’t.

I will show that to the extent the Ellington decision has anything to say about such budget transfers, it supports what I said, that they are to be approved by the Town Meeting. But essentially, the decision is not about town meetings at all, but about the relative power of boards of education and boards of finance with respect to spending on education. There was, I believe, no reason to even bring this decision up, except to make it look like there was support for Mr. Donofrio’s position, when there in fact was no such support.

First, let’s see what the Supreme Court’s opinion says about Town Meeting approval of budget transfers from a contingent fund. Three times in the opinion the powers of the Town Meeting are mentioned.

But first, the most important fact concerning the Town Meeting is stated on the last page of the opinion, page 472, the first highlighted passage, as follows:

The defendant [the board of finance] had recommended the appropriation of an additional $46,300 for school purposes, and the town meeting approved its recommendation.

Where was this $46,300 placed? Some of it a contingent fund, some of it in a capital fund. So, in the case before the Supreme Court, a Town Meeting had approved the future transfer of education funds from a contingent fund. Nothing in the court’s opinion says that it was wrong to ask for Town Meeting approval. Neither the board of finance nor the board of education argued that it was wrong to seek Town Meeting approval of this transfer. It is taken for granted that Town Meeting approval of transfers from the contingent fund are perfectly fine.

I agree completely. This position is emphasized just below, on the same page:

So long as the purpose of the appropriation remains unaltered, it is not necessary to resubmit the disposition of these monies [that is, their transfer to the board of education] to a vote of the electors.

The Connecticut Supreme Court clearly felt that the Town Meeting (which consists of a town’s electors) has an important role in approving budget transfers, so much so that if a budget transfer is not made for the purpose the Town Meeting intended when it approved the transfer, the board of finance has to resubmit the transfer to the Town Meeting. That’s what I call respect for the rights of the Town Meeting with respect to transfers from a contingent fund!

In the first column of page 471 of the opinion, the Court paraphrased the statute:

Once their [the board of education’s] appropriation for any fiscal year has been exhausted, they cannot expend town funds unless the board of finance makes a special appropriation, and if the funds needed exceed certain amounts, a town meeting must vote the appropriation on recommendation of the board of finance.

Here the Court is recognizing what I argued in the rest of my speech: that further funds by any department, in this case education, must be approved by the Town Meeting. And the Court does not distinguish between further appropriations coming out of extra cash or out of a contingent fund or out of a capital fund. It treats all equally.

The town of North Haven does not treat these transfers the same, and Mr. Donofrio defended its failure to do so, citing a Supreme Court opinion that actually treats the transfers the same, knowing that no one in the audience would know better.

Finally, the Connecticut Supreme Court recognized the most basic rule involving budget transfers, in the only highlighted passage on page 469:

In Ellington, the power of budgetary control is exercised in the first instance by the board of finance,... and, ultimately, by the town meeting...

That’s what the Supreme Court says about the powers of the Town Meeting in Connecticut: that it has the ultimate power of budgetary control, that a board of education (or any department) cannot expend extra town funds without Town Meeting approval, and that if the intended purpose of a Town Meeting-approved transfer is changed, the transfers must be resubmitted to the Town Meeting. And in the case before the Court, the transfers were to come from a contingent fund and a capital fund, and both these transfers had been approved by the Town Meeting, and done so legally.

Does this sound like the Court "makes no reference whatsoever to Town Meeting approval of transfers from a contingent fund in the budget"? Does this sound like the Town Meeting can be ignored just because transfers come out of the contingent fund rather than out of surplus cash funds? No, it sounds like the Court assumed that the Town Meeting has a role in approving all transfers over $20,000, wherever they come from, including our Contingent Fund.

And that’s what I said. But Mr. Donofrio made it clear that I was completely out of line in asking that the budget transfer motion be rejected in order to force the Board of Finance to send us the $1 million in transfers from the Contingent Fund for our approval. He said:

And I’m not going to get into a lot on the contingent fund, because there’s absolutely nothing in the call of the meeting tonight, of the Town Meeting, that has anything to do with transfers from the contingent fund, and therefore this town meeting, pursuant to charter and state law, has no jurisdiction to deal with anything other than what’s in the call.

You see: we had no jurisdiction to deal with it because it’s not in the call of the meeting. This means that if the Board of Finance and the Board of Selectmen ignore the law, that’s just tough. The Town Meeting has no right to defend its rights and ask the Board of Finance to follow the law. This is a serious distortion of the law. The Town Meeting had every right to vote against the budget transfers motion and insist on having the Contingent Fund transfers sent to it for approval.

I could go on and respond to every sentence of Mr. Donofrio’s speech, but you get the point. He distorted and misrepresented the law, and this is not in the interest of the town. The interest of the Town Meeting is to know what the law is and to make an informed, responsible decision. Mr. Donofrio prevented us from being properly informed in order to protect his political associates from being seen breaking the law. That would not have looked like responsible, professional management, and that might have affected how people voted at the upcoming election.

Remember, Mr. Donofrio is a member of the Republican Town Committee and a political appointee. He was not a neutral attorney stating the law. Instead, he acted as an adversary, staking out a position rather than seeking out the truth.

It was not truth, but the election that was at stake at the September 25 Annual Town Meeting. His interest was not the Town Meeting’s rights, nor the Town Meeting’s interests, nor a fair, neutral statement of the law, but the interests of Republicans in getting re-elected.

And since few people will read this, since the Democrats believe that this is too complicated an issue to bring up, and since there will probably be little or nothing about this in the press, Mr. Donofrio succeeded in fooling the Town Meeting, taking away its rights, and making it an accessory to breaking state law, all to get his friends re-elected and to keep his job as Town Attorney. What else could be the explanation for his misrepresentation of a 1963 Supreme Court case, not to mention other misrepresentations and distortions of the law?