State Sen. Meyer Praises Governor's Address, But Says Proposed Budget Appears Heavy On New Taxes, Not Specific Enough About Cuts

Gov. Dannel P. Malloy on Wednesday gave his first budget address, and explained how it would affect expenditures in the state for the next two fiscal years, from local and state education and municipal funding to state employee consessions and increased taxes.

The impact upon Madison of the proposed budget would be a reduction in state grants to the town of only about $13,000 in each of the next two fiscal years, based on a preliminary analysis prepared by the Connecticut Conference of Municipalities (CCM).

"It looks like we're going to be hit by about $12,000 or $13,000, which is bad, but it could have been a lot worse," Madison First Selectman Fillmore McPherson told the town's Board of Finance Wednesday evening. 

The town would receive approximately $8,277 less on the education side in proposed fiscal year 2012 and $8,732 less in 2013 for transportation grants, according to the CCM figures. The town would receive about $4,700 less in both years for payments in lieu of taxes (PILOT) for state-owned properties such as Hammonasset Beach State Park and state-owned forest land in town, according to the CCM figures.

The town received a total of $2,441,832 for fiscal year 2011 from the state, including $1,605,263 for education and $836,569 in non-education grants.

Sen. Meyer says address was stirring, but takes issue with specifics of budget proposal

State Sen. Ed Meyer, D-12th District, which includes Madison, Branford, Durham, Guilford, Killingworth, and North Branford, said he thought the governor's address was in some ways "very stirring."

"It was very inspring with respect to job creation. It was forward looking and it lifted up all of us, Democrats and Republicans," Meyer said. "The proposed budget itself is something else. I have lots of issues with it. It appears to be very heavy on new taxes and there is not a lot of specificity with regard to budget cuts. It's early in the budget process, but I'll be looking at it carefully, cautiously, and somewhat critically."

Kathi Traugh, Madison Democratic Town Committee chairman, said her initial impression of Malloy's address was favorable.

"I think Governor Malloy has shown real leadership with his proposed budget," she said in an email Wednesday evening. "It does many things we have been hearing for years are needed, such as demanding concessions from the state employees, consolidating state agencies and not relying on borrowing to make up budget gaps. It calls for sacrifice from all of us in the form of increased taxes. And it does not cut aid to towns, which is very important to Madison. It is a tough budget but a responsible budget."

Candidates for 101st District House seat express support, opposition

Joan Walker, Democratic candidate for the 101st District seat representing Madison and North Guilford, said she is pleased that Governor Dannel Malloy's proposed budget puts an emphasis on job creation and is "balanced honestly."

“I am pleased that Governor Malloy has presented a budget proposal where job creation is the prime focus, a proposal that is balanced honestly and asks for shared sacrifices.” Walker said in a prepared release. “The three main points that I have been talking about since this campaign began – creating a business environment conducive to job creation, consolidation of government agencies to create efficiencies, and maintaining funding to local towns are all covered in this budget.”

Madison Selectman Noreen Kokoruda, who also is a candidate for the open state representative seat for Madison and North Guilford

Wednesday evening, she added, "While I  give Governor Malloy credit for refusing to borrow more money for our operating expenses, I am somewhat surprised  that he did not seize this opportunity to fundamentally restructure state government and make meaningful cuts that would force the state to live  within its means. Our priority should be to restructure  government and make it leaner before turning to taxpayers and telling them that they don't pay enough and need to pay more."

Budget proposal highlights and details

A more detailed breakdown of Gov. Malloy's proposed budget can be viewed here.

For a more general overview, here are some highlights from the governor's address:

• State employees must agreed to various concessions or risk the chance of mass layoffs;
• The enactment of an earned income tax credit of 30 percent for working citizens;
• A new incentive for the first five companies "that bring hundreds of new jobs" to the state;
• The consolidation of state agencies by 30 percent;
• The institution of various new taxes and an increase in the sales and, for some, income taxes;
• Maintain municipal grant funding from the state;
• Fill the gap that will be left in state ECS funding when the federal ARRA grant expires in June;
• Provide money for more magnet schools and begin to transfer control of vocational-technical schools from the state to local school districts;
• Convert Medicaid programs to a self-insured model; and
• Improve the state transporation infrastructure.

The Republican leadership has already begun to question Malloy's proposal and are critical of his accounting, his suggestion of raising various taxes and have said that not enough of the spending portion of the budget has been eliminated. To view a YouTube video of House Minority Leader Lawrence Cafero discussing Malloy's proposal on Feb. 15, click here.

OPM Secretary says budget calls for "shared sacrifices" but spares local services

In a briefing prior to the release of Gov. Dannel P. Malloy’s state budget proposal, Office of Policy and Management Secretary Benjamin Barnes detailed the plan to reporters Wednesday morning.

Faced with filling a projected $3.2 billion deficit in the coming year, Barnes repeatedly touched on the point that Malloy’s budget calls for a number of “shared sacrifices,” but protects local services.

Among the proposals included in Malloy’s recommended budget, which has a “bottom line” total of $17.94 billion for the 2011-12 fiscal year, and spending of $18.37 billion in fiscal year 2012-13, are numerous spending cuts and tax increases, the consolidation of about 30 percent of state agencies, and changes in the state’s revenue structure to eliminate dependence on borrowing or one time revenue to meet operating expenses.

“Balancing this budget will require shared sacrifices,” Barnes said. “Overall, the budget includes more spending cuts than tax increases.”

Malloy’s proposal includes $1.76 billion in reductions in spending, coupled with $1.51 billion in estimated increases in income, sales and other taxes in the first year of the budget.

The governor's budget also calls for the restoration of $270 million over the next two years to the Education Cost Sharing grant to cities and towns to make up for the anticipated loss of funds from the American Recovery and Reinvestment Act, whith is set to expire at the end of June. The federal funding is currently plugging about a 14 percent hole in ECS grants to local municipalities. Barnes said the ECS restoration would restore the state’s funding to the 2009 level.

Malloy’s proposal also relies on about $2 billion in savings and reductions over the next two years - $1 billion each year - from unionized state employees who are already under contract, Barnes said.

When asked how the budget would be balanced if those savings were not realized, Barnes replied: “The spending reductions that the governor has proposed, we intend to accomplish.”