Stefanowski insists $3.1 billion rainy day fund is a 'misnomer'

By Scott Benjamin

When Ned Lamont and Bob Stefanowski were galloping toward the finish line in a 2018 gubernatorial election that was determined by about 44,000 votes, they were talking about the income tax, highways tolls and unfunded pension liabilities.

“COVID-19” was not part of their vocabulary.

As of October 29, Lamont has signed 77 executive orders and his work on addressing the pandemic has generated the highest poll approval numbers for any Connecticut Democratic governor since the early mid-1980s when William O’Neill (D-East Hampton) had been re-elected to a second full term with 59 percent of the vote.

The Zip06 web site has reported that Stefanowski, a Republican, who lost the 2018 has, along with his wife, Amy, a realtor, helped raise money to supply more than 1.6 million pieces of personal protection equipment to hospitals, first responders, schools and the general public.

“It has been tremendously emotionally rewarding,” said Bob Stefanowski said in a phone interview with Patch.com.

A poll in September indicated that 65 percent of Connecticut residents approved of Lamont’s handling of the pandemic, the fourth highest rating for a governor in the nation, according to a poll conducted collaboratively by Northeastern, Harvard, Northwestern and Rutgers universities.

The Day of New London has praised him for having “a plan and a destination” during the crisis.

Said Stefanowski, "Some of what Mr Lamont has done on COVID is hard to argue with, but he really dropped the ball in taking care of our most vulnerable in nursing homes. As a result, CT has one of the highest ratios of deaths per capital in the nation."

NBC CT 30 in West Hartford reported that on October 29 Connecticut’ positivity rate had increased to 6.1 percent, the highest it had been since June 1. The state’s most recent phase of reopening had started on October 8.

Stefanowski said, “The fact that the number of cases is increasing is a concern.”

The News-Times has reported that in late October there had been a “second wave” of COVID-19 cases.

For example, the Danbury public schools have operated on strictly distance learning since the beginning of the academic year.

Stefanowski said, “I understand that there are rates of high incidences, such as Danbury. I understand the importance of being safe.”

“But in the areas with low incidences, we’re talking about 17- 18-year olds who have .001 percent of the mortality risk. I think there is a fine arrow. They are missing out on a lot of social interaction even under a hybrid system where they spend part of the week in school and part of the week on distance learning and the football team is not playing.”

Stefanowskii said the reopening of the schools with hybrid education systems – where students devote two days to conventional classes and three days to distance learning appears to have been successful.

“But for working parents it can be a challenge in staying home with the children and making sure that they are at a computer,” he added.

Stefanowski of Madison has been called by Sacred Heart University Government Department Chairman Gary Rose “the face of the Republican Party” in Connecticut since the 2018 election.

The former GE and UBS financial executive, who never ran for elected office before the 2018 campaign, was a speaker at several of the No Tolls rallies last year and this fall he has been featured at campaign rallies, in video endorsements and canvassing for GOP legislative candidates.

Regarding the national economic recovery from the pandemic, Stefanowksi noted that gross domestic product soared by 33.1 percent following an almost equal decline in the second quarter.

“More economic stimulus will help,” he said regarding the negotiations for another federal package to supplement the $2.2 trillion CARES Act that Republican President Donald Trump signed in March. Until recently, Treasury Secretary Steve Mnuchin and U.S. House Speaker Nancy Pelosi had reportedly discussed a $1.9 trillion package.

CT Mirror reported in July that Lamont supported more unemployment compensation but at a level below the provisions provided in the CARES Act.

“There needs to be a certain level,” Stefanowski said. “However, there are some small businesses that can’t get their employees back because they can make more money through unemployment compensation. There should be more emphasis on getting businesses moving at 100 percent of operations.”

When asked about the record $3.1 billion in the state’s rainy day fund, Stefanowski said it is a“misnomer.”

“Connecticut is bankrupt and it has to face that fact,” Stefanowski said regrading what the state Commission on Fiscal Stability & Economic Competitiveness in 2018 called $80 billion in long-term obligations in pension and other retirement benefits, according to CT Mirror.

A November 1 Wall Street Journal editorial stated that Fitch Ratings has reported that Connecticut has a pension liability for its workers that equals 25.9 percent of personal income – the second highest in the nation, behind Illinois. Fitch indicated that anything above 20 percent is considered to be “elevated.”

Said Stefanowski, “The state cannot continue to be in denial. It will be best to get this addressed as soon as possible for the state and for the unions.”

He said he questions Lamont's decision to allow state employees to get a negotiated pay increase starting this last July 1.

“People are being laid off and furloughed and the state employees got a raise,” he said of the salary hikes that went forward from a contract that was negotiated by former Gov. Dannel Malloy (D-Essex), Lamont’s immediate predecessor.

CT Mirror had reported at the time that Lamont said he “has no authority to unilaterally abrogate a contract and postpone raises.”

Said Stefanowski, “He has the emergency powers. I have to believe that he could have nullified those raises.”

Manchester Journal-Inquirer columnist Chris Powell wrote that Lamont had the power to negate the raises but did not want to offend the state employees who are “the army of his political party.”

Patch.com has reported that state Rep. Ken Gucker (D-138) of Danbury has said, “They [the state employees] made sacrifices to get us through the Great Recession. If I was a state employee, I would be very upset. At some point we need to honor our commitments."

The Hartford Courant has reported that the state will be spending $2 million for a study from the Boston Consulting Group to determine how to structure a work force that could contract in the next three years with a projection of numerous retirements.

Stefanowski said savings could be achieved by “just telling each department head to reduce their budget by five percent or you as governor will reduce it by five percent.”

CT Hearst business columnist Dan Haar has stated that Malloy slashed the full-time state employee payroll by 13.1 percent during his eight years in office.

On another topic, The Wall Street Journal reported in July that as a result of the pandemic there had been influx of residents from New York City and Westchester County seeking to buy homes in Connecticut.

“Real estate values are up” in Connecticut, said Stefanowski. “People living in New York are scared.”

“The question becomes how we make it permanent,” he added. “We need to have an economy that is friendly to businesses.”

Regarding economic growth, Stefanowski said he is concerned that defense manufacturer Raytheon, which owns the Francis Pratt & Amos Whitney operations in East Hartford and Middletown, has opted to expand by spending $650 million for a facility in Asheville, N.C., near its Collins Aerospace division, that will generate 800 new jobs.

He said, “Ned Lamont said he was going to watch Raytheon like a hawk” after it announced its merger last year with United Technologies, which has had operations in Connecticut for generations. The former CEO of United Technologies, Greg Hayes, now holds that same position with Raytheon.

“There are lower corporate tax rates and less expensive housing available in North Carolina,” Stefanowski said in explaining Raytheon’s decision.

The late Oz Griebel of Hartford, who was an independent candidate for governor in 2018, told Patch.com last year that he was concerned about maintaining Raytheon’s current manufacturing based in Connecticut since the Collins division, which Raytheon acquired in 2017, offers strong options in in North Carolina and Florida, where it already is based.

On another topic, Fred Carstensen, the University of Connecticut professor who directs the Connecticut Center for Economic Analysis has told Patch.com that over the last decade Connecticut has not developed a digital information center, as other states have and has failed to develop major collaborative projects through public-private partnerships.

He said that the $100 million stem cell research project that former Gov. M. Jodi Rell (R-Brookfield) signed in 2005 was “hands down” due to the work of Yale, Wesleyan and the University of Connecticut, the best program of its kind in the nation.

Carstensen said the state hasn’t followed the example in Massachusetts, where a $100 million high performance computer center was built in Holyoke through the help of MIT, Harvard and UMass-Amherst and has made considerable money for the state.

Stefanowski remarked, “Connecticut has colleges that could produce economic development the same way that it is done in Boston, Silicon Valley and San Francisco.”

Former Gov. John Rowland (R-Middlebury) told Tom Monahan of WVIT Channel 30 in West Hartford in 2006 that his legacy was improving the infrastructure at Connecticut’s public colleges.

From the mid-1990s to the mid-2000s, for example, Western Connecticut State University in Danbury added $180 million on new buildings and renovations.

Students who had graduated from the University in Connecticut (UConn) at Storrs in the 1980s would visit the campus in the late 1990s and say that there were parts of it that they didn’t recognize.

Yet, CT Mirror has reported that the state contribution to in-state tuition at UConn was about 50 percent per student in the early 1990s and is now less than 25 percent.

Stefanowski said, “I think that has been a problem. We want decent facilities but how much you spend on arts and sports is a good question. The money might be better spent on lowering tuition and lowering student/teacher ratios. We may have gotten carried away with the capital expenses.”

On a separate subject, Stefanowski said Connecticut’s high schools should increase their commitment to business classes.

The National Center For Education Statistics reports: There are almost twice as many business majors in college nationally than the next two most popular majors combined – health professionals and social science/history.

Writing in Consumer Affairs, Mark Huffman stated that only one in six high school students graduate with a class in personal finance.

If so many students major in Business in college, then why are there so few Business-related classes in the public high schools?

Said Stefanowski, “I think there is value to teaching more students in high school how to use a spread sheet and be disciplined in personal finance. That would be helpful.”

Economist Allison Schrager of the Manhattan Institute said during a recent Zoom discussion sponsored by the Yankee Institute, which is based in Connecticut, that the pandemic will likely “accelerate” changes that were already under way.

Stefanowski partly agrees, saying, “I think you will see more people who only go into the office just once or twice a week since it is more efficient to work from home. There will be more meetings done through Skype and fewer flights to California for business meetings. I think there will be a middle ground on how things change.”

Regarding Republican President Donald Trump, he offers high praise for the 2017 tax reform which helped reduce unemployment to 3.5 percent – the lowest in 51 years – before the pandemic and enacting a deregulation program that lowered prices.

“It is hard to argue that anyone could have done better on the economy,” Stefanowski exclaimed.

However, he said the $10,000 cap on state and local tax deductions in the president’s tax reform – which has had an impact in the wealthy Fairfield County Gold Coast, in particular – should be revised.

Remarked Stefanowski, “I understand nationally why it was done, but there are people in Connecticut that are paying plenty in property taxes alone, so I think it would be best to raise that cap.”