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$650K Bridge Payment Upsets New Canaan Council

A decision to pay a company $650,000 in an arbitration award is not sitting well with members of the New Canaan Town Council who say they were left in the dark about it.

New Canaan will transfer the money from the town’s general fund to reimburse capital non-recurring funds that were used to pay Loureiro Contractors. The company won an arbitration award in a dispute over the construction of the Lakeview Avenue Bridge, which was finished in 2008.

Council members said during Wednesday’s meeting that they did not know about the award until this week, a month after the council approved the town’s $121.6 million budget for the 2011-12 fiscal year. The Loureiro award was officially announced Feb. 25, although the town challenged the decision. Because the award payment came from capital nonrecurring funds, it did not require a Town Council vote.

“We all should have known about it,” said council member Paul Foley. “This is just not appropriate.”

Council member Beth Jones expressed anger about not knowing and said the expense should not be covered with a $650,000 bonding issue. “This should not be condoned. This is an outrage,” she said.

The Board of Finance voted unanimously last Tuesday to bond for $650,000, but the Town Council failed to push the bonding along after voting 6-4 to use money from the general fund. Although the vote technically failed because it required seven votes, the money will likely be pulled from other town funds. The town’s tax rate for the 2011-12 fiscal year, approved last week by the council, will not be changed.

Steve Karl, who served as chairman in place of Mark DeWaele, said the council will create a committee to ensure the Town Council is better informed of such expenditures.

First Selectman Jeb Walker says he disagreed with the arbitration ruling but said the town must pay the bill. The Board of Finance, which Walker chairs, will take up the issue at its next meeting.

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