CT Budget Not Adopted As Deadline Nears

HARTFORD, CT — It was a wild day at the state capitol Tuesday after legislative fiscal committees failed to adopt a budget. Legislative Democrats proposed a budget that did away with many of Gov. Dannel Malloy’s proposals, but the plan was later withdrawn.

The Appropriations Committee announced Tuesday afternoon that a vote wouldn’t be held. It’s deadline for a vote is Thursday. There is also a chance the Finance Revenue and Bonding Committee won’t finish work before it’s Friday deadline, according to the Connecticut Mirror.

Gov. Dannel Malloy was displeased at Tuesday’s developments.

“I am profoundly disappointed that neither Democrats nor Republicans could produce a budget that makes responsible progress toward addressing our fiscal challenges,” he said in a statement. “I stand ready to work with leaders of both parties as they come to terms with the real and growing challenges facing Connecticut.”

He also reiterated his commitment to focusing on a budget that relies more on spending cuts than tax increases.

Among some of the proposed revenue options put forth by lawmakers are:

• Increase income tax to 7.49 percent for top bracket filers.
• Increase the sales tax to 6.99 percent from 6.35 percent.
• Bump the bottle deposit fee to 10 cents from 5 cents.
• Add tolls to highways.
• Impose a “soda tax” that would add 1-cent-per-ounce to drinks with added sugar.

Another proposal would allow municipalities to tax property at 100 percent of assessed value instead of 70 percent.

“I will not push off this year’s problems onto future generations,” Malloy said. “And I will not support a budget filled with gimmicks or unsupported revenue projections.”

Scrambling to Fill Budget Hole

Connecticut’s state budget stands at around a $1.7-billion deficit for the next fiscal year. The actual number may be closer to $2 billion if a trend toward lower income tax receipts holds true through the end of the week.

Malloy is seeking state employee union concessions of $1.57 billion in the next biennial budget, breaking down to $700 million in savings in the 2017-18 fiscal year and $869 million in 2018-19. Up to 4,200 state employee layoffs could occur if concessions aren’t made.

The Democrat legislative proposal called for a 5.2-percent spending increase next fiscal year and 1.8 percent for the following year.

Municipal leaders pressured legislators to not pass Malloy’s proposal that would shift one-third of teacher pension costs to local systems. The proposal also called for keeping education cost sharing funding at the same level, but reworking the formula for a more fair system, according to the Hartford Courant.

The Democrat legislative plan would’ve increased spending by $200 million next year over Gov. Dannel Malloy’s proposal, but would also save municipalities about $400 million in pension costs. It also called for restoring hospitals to tax-exempt status on real property.

Image via Lisa Jacobs/Flickr Commons