Greenwich Delegation Opposes Gimmick Laden Budget

Hartford- State Representatives Livvy Floren (R-149), Stephen Walko (R-150), and Fred Camillo (R-151) and State Senator L. Scott Frantz (R-36) opposed an approximately $19 billion state budget agreement between Governor Dannel P. Malloy and majority Democrat lawmakers that is fraught with unexplained revenues and one-time gimmicks to achieve fictional fiscal balance.

Earlier this week consensus revenues between the Office of Policy and Management (OPM) and the Office of Fiscal Analysis (OFA) showed a precipitous drop in anticipated tax revenue to the state by approximately $460 million.  This forced Democrats to abandon plans to send a $55 rebate check to each taxpayer just before the November election.  The new budget also repeals plans to allow the Connecticut Lottery Corporation to introduce keno as a lottery game, a measure passed last year that was unpopular with state residents.

To help buoy the deflating revenue estimates of the budget, Democrats resorted to relying on a last-minute revelation of $75 million in “miscellaneous revenue.”  When pressed as to where this newfound windfall was expected to come from, Democrat leadership indicated that they expected to collect the funds from delinquent taxpayers.

“Finding $75 million at the last minute, with the hope that the success of the tax amnesty program will be repeated may be a great thing to wish and hope for, but I sure wouldn't want a business I was in to be run that way. A budget based on assumptions is not one I can support. Moreover, relying on fund sweeps of over $200 million is a continuance of a practice that is not honest and a root cause of what got us into a hole in the first place,” said Rep. Camillo (R-151).

The Democrats’ budget also relies on the raiding of critical off-budget accounts, including:

•           $20.5 million from road and bridge repair funding

•           $10 million from the tobacco and substance abuse prevention fund

•           $19.2 million from the Clean Energy Finance & Investment Authority

“Unfortunately, this budget again fails to address the systemic issues which have plagued the financial integrity of Connecticut.  We should reduce spending, not fill budget shortfalls through artful accounting and one-time revenue generators." Rep. Walko said (R-150). “We owe it to our fellow citizens and our children to stop passing budgets we cannot afford.  This budget not only continues down the path of fiscal incompetency but further erodes the ability of Connecticut to attract jobs and grow.”

Democrats are postponing the reinstatement of the sales tax exemption for clothing and footwear until July 1, 2015, and the sales tax exemption on non-prescription drugs to April 1, 2015.  It also moved the tax exemption for teachers’ pensions to out years.

The majority party’s budget claims $20 million in unspecified hiring reductions, uses $30 million of one-time surplus, reduces funding to the Transportation Fund which pays for road and bridge upkeep, and moves $5.8 million in expenditures to bonding.  They also managed to make the budget appear balanced on paper by moving numerous items outside of the General Fund.

"Legislators have a responsibility to make decisions that will protect the people of Connecticut today, tomorrow and for years to come. The majority party failed to meet that responsibility by passing a budget that puts the state on a path that will cause significant deficits in coming years,” said Sen. Frantz (R-36).  “It reflects the poor planning and wishful thinking that has damaged our state's fiscal health and future. To restore economic stability we need to be honest and realistic about spending. Sadly, this budget fails to meet these vital needs."

The House Republican Caucus proposed their own budget amendment, which reduces spending, restores funding for road and bridge repairs, increases municipal aid by $21 million, takes a step toward reducing long term liabilities and stays below the Constitutional Spending Cap. Legislative Democrats, who left Republicans out of budget negotiations, voted down the amendment on a party line vote.

“I was disappointed that we were not able to trim current expenditures ... but we will continue to work hard to create more favorable job market and business friendly growth climate growing forward,” said Rep. Floren.