State budget impasse enters record territory

State budget impasse enters record territory

Record-Journal
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When then Gov. M. Jodi Rell announced that she wasn’t going to veto the budget lawmakers approved on Sept. 1, 2009, it ended the longest budget standoff in state history.

Rell didn’t sign the budget, meaning it didn’t take effect for another five days, but municipalities, nonprofit service providers, and other funding recipients were able to move forward with the knowledge that a spending plan was in place.

The current fiscal year is entering its third month without a budget deal in place, meaning the current standoff will replace the 2009 impasse as the longest in state history.

Lawmakers remain at odds over a $3.5 billion deficit over the next two fiscal years — the projected deficit was $5.1 billion, but a labor savings deal approved along party lines in July is expected to save $1.57 billion.

“I think that we are seeing the most difficult of all the times we’ve had with budgets,” said state Rep. Cathy Abercrombie, D-Meriden. Abercrombie made the remark at a recent press conference of nonprofit service providers urging for a budget. “We need to bite the bullet and get the budget out and live with the consequence of what the budget shows.”

Gov. Dannel P. Malloy has repeatedly expressed concern that he sees no end in sight, saying in an Aug. 22 podcast with the Record-Journal that “this looks like (the budget) might not get done until October or later in large part because people seem to be unwilling to accept reality.”

“I think Democrats and Republicans just haven’t adjusted to the reality,” he added. “The reality is money comes in slower than they would like, therefore you have to stop spending it, or make adjustments to your spending plan and revenue plan.”

House Democrats are optimistic they have a solution and plan to vote Sept. 14. Senate Democrats also say they intend to take action the week of Sept. 11, although no session has been scheduled.

The House Democrats’ budget raises roughly $1 billion in new revenues annually, partly by increasing the sales tax to 6.85 percent and hiking the cigarette tax. They continue to negotiate with Senate Democrats, who have previously expressed doubt that they could get full support, and Republicans, who have criticized the idea.

Malloy has also threatened to veto any budget he feels “leads with revenue.”

The 2009 stalemate also revolved around disagreements on how to close a deficit, with the state looking at an $8.5 billion deficit for the 2010 and 2011 fiscal years. Rell expressed a willingness to increase the income tax for the highest bracket, but only in exchange for a drop in the inheritance tax.

Democrats didn’t oblige, though, and had veto-proof majorities in each chamber that year.

While the deficit is smaller this time around, so are the voting margins — the Senate is tied at 18 seats for each party, and the Democrats hold only a seven-seat majority in the House. That means Democrats need to garner the support of either Malloy and Lt. Gov. Nancy Wyman, who casts tie-breaking votes in the Senate, or enough Republicans to get the two-thirds majority needed to override a veto.

Senate and House Republicans have both pressed for votes on their proposals, although they were forced to revise their plans after the approval of the labor deal. The agreement with state employees also took away some of the labor savings proposals in the Republican budgets and knocked them out of balance.

Senate Republican Leader Len Fasano, R-North Haven, and House Leader Themis Klarides, R-Derby, have criticized Democrats for adopting the deal without a budget agreement being in place, but say they are committed to continuing in bipartisan negotiations. They also refused to call a sales tax increase a deal-breaker, despite their recent objections.

“I just say I never say never, because I think once you say ‘I never,’ you stop any conversation,” said Fasano, who also represents Wallingford, adding parties should “never draw lines” during negotiations.

Democrats say additional revenue is the only way to avoid the municipal aid cuts in Malloy’s budget, and said objections to their budget next month would be akin to support the even deeper cuts in the current executive order.

“If you don’t want to work in a bipartisan way and you vote no, you are going to be just as responsible as everyone else for the cuts that go to your town,” said House Majority Leader Matt Ritter, D-Hartford. “I truly believe that.”

Malloy has said the municipal aid cuts are necessary because the state cannot support another tax increase, but the state cannot continue to shrink government and nonprofit service funding to protect towns from similar reductions.

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


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