Finance Revenue and Bonding Committee Meeting Update

Hartford, CT – Senator Toni Boucher (R-Wilton) released the following statement re: Finance Revenue and Bonding Committee budget Recommendations for the state budget.

“The Finance Committee passed a mixed bag of bills last week, some good and some bad.

“AN ACT CONCERNING EMPLOYERS AND HEALTH CARE was passed out of the committee on a straight party line vote and was highly controversial. This bill would penalize businesses $10,000 for employee who have their own private healthcare plans outside of the business. The mere discussion of this bill in committee, even if it does not proceed further exacerbates Connecticut’s anti-business reputation.

“AN ACT CONCERNING THE ESTABLISHMENT OF TOLLS FOR THE EXTENSION OF ROUTE 11 was another controversial bill passed out of committee. Many questions remain on this bill. Would this bill lead to border tolls or tolls on all state highways? Would fees remain in the transportation budget or redirected for the purposes of balancing the budget? It is unwise to move this bill forward until we have the state Department of Transportation’s study of alternate means of funding for our roadways and mass transit.

“AN ACT LIMITING EXPENDITURES FROM THE SPECIAL TRANSPORTATION FUND (STF) would prohibit the practice of raiding the STF to balance the state budget and received unanimous support from the committee.

“Senate Bill 843: AN ACT CONCERNING REVENUE ITEMS TO IMPLEMENT THE GOVERNOR’S BUDGET became the most important bill for the Finance Committee to address. Two controversial aspects of this were found in sections 18 and 19.

“Section 18 establishes a tax credit for gas companies that provide financial incentives for certain customers to convert to natural gas. Oil companies feel that this allows government to pick winners and losers. Section 19 mandates the states to arbitrarily auction off current CL&P customers for a profit to balance the budget.

“I was unable to support this tax bill for a number of reasons, not the least of which was that it continues to raise taxes and increase spending at an unsustainable rate. It increases the petroleum gross receipts tax from 7% to 8.1% on July 1st at a time when Connecticut already has the highest gas tax in the nation. It also raids the Special Transportation Fund by once again sweeping $77 million to balance the state’s budget.

“In addition, Senate bill 843 would extend the temporary 20% surcharge on corporations that was to sunset by June 31, 2013. By extending this anti-business tax into the future, the legislature is putting up a white flag of surrender, or worse yet, endorsing a failed policy to balance the budget. This anti-business tax along with increases in the gas tax, fees and sales tax on clothes and shoes, and tax on insurance premium credits adds to Connecticut’s reputation as an anti-business state. In addition, the proposal to repeal of the car property tax was moved out five years.

“Each day we receive a list of top news items. The day that the Finance Committee met, one headline was particularly appropriate. It read, “Tax Hikes Rank State Fourth in the Nation.”

“Usually, personal income growth is a good indicator to watch if you are deciding whether to increase state spending. Economists note that when you spend above that rate, you are taxing more than what taxpayers can afford. Since personal income growth, was only 2% from 2011-2012, the second slowest in the country, I believe this two year tax and spending proposal asks more from those already hit hard by the recession and by the highest retroactive tax increase in the state’s history.

“The Governor’s Office reports that the economic recovery of the state is “quite slow” and only shows “minor growth.” Most of us have felt this for some time. A budget is a statement on the direction you wish to take the state. A 9.6% spending bill in the next two years while revenues fall short of forecasts and employee concessions are only half of those predicted, does not engender confidence that we are moving the state in the right direction.

“Does this budget proposal support the growth of the private sector and jobs or does it protect and grow the government sector? The Tax Foundation publishes an annual list of each state’s tax free day. Tax Free Day is when taxpayers stop working to just pay for their tax obligation and start working to pay themselves. Increasingly the public is asking who is working for whom? With the latest tax free day in the nation, May 13th, the answer in Connecticut is that the taxpayer is working to support its government.”

Senator Toni Boucher is a ranking member of the Finance Revenue and Bonding Committee.