GOP, Democrats release revised budget proposals as negotiations continue

GOP, Democrats release revised budget proposals as negotiations continue

Record-Journal


HARTFORD — Lawmakers on Tuesday followed Gov. Dannel P. Malloy’s, lead balancing their budget proposals without increasing taxes and seemingly finding some level of agreement as another round of negotiations were scheduled for Wednesday.

They arrived at balanced budget in different ways, though, with Democrats relying on gaming expansion, tolls, and the legalization of marijuana to provide a revenue influx. As a result, they have the largest of the three spending plans presented Tuesday.

All sides are looking to address a roughly $5 billion deficit over the next two years.

House and Senate Republicans, who presented their plans, mocked the ideas, saying Democrats were making questionable policy decisions in search of new revenues. They also questioned some of the Democrats’ projections.

The Democrats’ budget, presented in concert by leaders in the House and Senate, would spend $19.78 billion in the next fiscal year and $20.06 billion in the following year. Senate Republicans, meanwhile, proposed a combined $39.44 billion budget, of which $19.65 billion would be spent in the first fiscal year.

House Republicans presented a plan that came in below the one Malloy presented Monday, allocating a combined $39.1 billion that includes $19.48 billion in fiscal year 2017-18. On Monday, Malloy proposed a $39.37 billion budget for the upcoming biennium, including $19.49 billion in the first fiscal year.

The three proposals presented Tuesday rely on various portions of Malloy’s budget, such as delaying $57.5 million each year for generally accepted accounting principles.

Lawmakers held firm in other, areas, though, including a continued rejection of Malloy’s proposal that municipalities pay $400 million toward the teachers retirement system. They also remain opposed to his proposal to remove hospitals’ exemption from the property tax, allowing municipalities to levy the tax if they choose.

The three budgets also differ greatly from each other in some areas, meaning lawmakers still have a lot to negotiate when talks resume. Leaders met with Malloy roughly two weeks ago to start talks, but there’s been little progress because each side has had to revamp their proposals in response to declining revenue projections.

Democrats have placed the biggest emphasis on new forms of revenue. They project the legalization of marijuana would bring the state $60 million in 2017-18, growing to $180 million in 2018-19.

Democrats also include the implementation of tolls and expansion of casinos, but didn’t provide any details on either or how much revenue, if any, the state might see over the next two fiscal years.

Other revenue changes include reducing the transfer of sales tax revenues to the Special Transportation Fund, saving more than $200 million each year. Notable cuts include roughly $340 million to municipal aid, $100 million of which would be realized through forced regionalization and $50 million to the Board of Regents for Higher Education and $10 million to the University of Connecticut.

House Speaker Joe Aresimowicz, D-Berlin, called the plan a “fiscally responsible blueprint” that recognizes the reality of the need for a more efficient state government.

Senate Republicans relied on a number of Malloy’s changes to balance their own proposal, but called for significantly more labor savings. Malloy is seeking $700 million in savings in the first year, followed by roughly $850 million the following year.

Senate Republican Leader Len Fasano, R-North Haven, said his caucus wants an additional $256 million next year, and $405.6 million more in fiscal year 2019. The increases were tied proportionally to increases in the projected deficit when revenue projections dropped.

Other notable cuts include a $24.7 million correction to the Republicans’ initial proposal for birth-to-three programs, which accidentally doubled expenditures, and reducing fringe benefit payments by $28.5 million. By far the largest influx of new revenues in the Senate Republican proposal would come by transferring $160 million in energy bill taxes to the general fund.

Fasano criticized some of the Democrats’ revenue proposals, and in particular questioned how they arrived at income projections for sources that currently don’t exist.

“That’s kind of questionable numbers, so how do you negotiate against a ghost?” he asked reporters. “How do you negotiate against something that doesn’t exist?”

House Republicans, meanwhile, are seeking $725 million in additional labor savings in each of the next two years, but they do propose $42.2 million in savings by reducing the state workforce 2 percent through attrition and a hiring freeze.

House Republicans also would hold off on changing the Education Cost Sharing grant formula, and thus eliminating the $67 million they had originally proposed in additional funding to help towns who lose money due to changes.

Other notable proposals include changes to the Earned Income Tax Credit, stopping the flow of sales tax revenue to municipal aid, and imposing a $1.3 billion bond cap to reduce the state’s long-term debt. Malloy’s self-imposed cap is $2.7 billion this year, the same as it was last year.

msavino@record-journal.com
203-317-2266
Twitter: @reporter_savino


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