State budget picture darkens [Rep-Am]

Editorial by the Waterbury Republican American

Connecticut’s Democratic-controlled legislature has passed, and Democratic Gov. Dannel P. Malloy has signed, a revised version of the 2015-17 budget the legislature passed in early June. The original budget attracted controversy because it imposed many taxes on businesses. No Republicans voted for the revised budget. Only four Democrats, Sen. Joan V. Hartley of the 15th District among them, said no.

Democratic leaders are patting themselves on the backs for the revision.

“I believe we have a budget that helps deliver prosperity for the future,” declared Gov. Malloy. House Speaker J. Brendan Sharkey of Hamden said, “We listened to the concerns of our constituents and business community to make (the budget) work better for everyone in our state.” Senate Majority Leader Bob Duff of Norwalk concurred, saying, “We have heard from those who have said, ‘You have to make some changes.’ … I value the employers in this state and appreciate what they do.”

The picture is a lot darker than the one painted by Gov. Malloy and company.

The revised budget does not stabilize Connecticut’s finances, and the consequences will hinder the state’s ability to compete for the business and industry the state needs for a prosperous future. While targeted spending cuts were made to roll back some business taxes, the budget remains spend-heavy. Spending will increase by 3.9 percent in fiscal year 2015-16 — which began yesterday — and by 3 percent in FY 2016-17; the original budget would have increased spending by 4 percent and 3.1 percent, respectively.

It was irresponsible to increase spending.

For decades, Connecticut has spent itself into crisis after crisis. This point is pertinent considering the governor’s Office of Policy and Management and the legislature’s Office of Fiscal Analysis projected an approximately $2 billion deficit for the 2015-17 biennium, and OFA has projected an $832 million hole for FY 2017-18. As we have noted, increasing spending in this environment maintains the crisis cycle and puts the state’s fragile credit at further risk.

Similarly threatening to the stability of Connecticut’s finances is the budget’s reliance on unreliable revenue sources, as well as on gimmickry. The income taxes of the state’s wealthiest residents will increase — overall, taxes will increase by $1.3 billion over the biennium — and keno will be added to the lottery lineup. Spending on pensions and health care for retired teachers and state employees will be moved out from under the state’s constitutional spending cap.

Connecticut will have a hard time piquing the interests of businesses and industries. Dysfunctional government finances create uncertainty that turns off business people.

Senate Minority Leader Pro Tempore Kevin D. Witkos, R-Canton, summed up the folly of the revised budget.

“We have not taken the nail out of the tire. We have not fixed the problem,” he said. When this house of cards collapses, Gov. Malloy and his legislative supporters will have no one to blame but themselves.

Legislative Republicans were not allowed in negotiations, and Republican former Govs. John G. Rowland and M. Jodi Rell have been out of office for years.