Rep-Am Editorial: State budget sets the stage for more crises

Republican American Editorial

Connecticut’s Democratic-controlled legislature has revised the $20.4 billion 2016-17 budget lawmakers and Democratic Gov. Dannel P. Malloy approved last summer.
The new, $19.7 billion budget was adopted on largely party-line votes, with eight Democrats joining all Republicans in voting no.
Gov. Malloy, who is expected to sign it, said, “This budget … is no doubt a critical start of the conversation heading in the right direction and reflects the beginning — not the end — of our work.”

The budget has more negative aspects than positive ones.
There is little reason to believe it will get Connecticut on solid ground when fiscal year 2016-17 opens July 1.

While the budget calls for more than $800 million in spending cuts, it will spend 0.4 percent more than the 2015-16 budget, according to reports from the Republican-American, the Connecticut Mirror and the conservative Yankee Institute for Public Policy. With Gov. Malloy’s Office of Policy and Management (OPM) and the legislature’s Office of Fiscal Analysis (OFA) having projected a $960 million deficit, a true spending cut was in order.
Indeed, even with the new budget, Connecticut faces an approximately $2 billion deficit in the 2017-19 biennium, according to the Mirror. (OFA previously projected an approximately $4 billion hole.)

The budget provides for higher health-insurance premiums, pensions are capped at $125,000 for non-union employees hired after July 1, but pension and health benefits of unionized state workers are unchanged.
The Republican-American reported on public support for renegotiating deals that prohibit such changes before 2022, and Senate Minority Leader Leonard A. Fasano, R-North Haven, urged Gov. Malloy to pressure the unions to renegotiate.

The budget depends on unpredictable and one-time revenues.
It “counts on enhanced tax collections and payoffs from lotteries, growth in cigarette tax receipts — and even payments from currently unsettled state lawsuits — to remain in balance,” the Mirror reported.
Additionally, it moves to the General Fund $53 million from smaller budget accounts. These are the marks of inherent instability.

Lawmakers made none of the structural changes included in the GOP’s alternative budget.
Among them were bonding limits and legislative approval of all union contracts.

It isn’t a surprise that the new budget is so flawed: It is the result of negotiations between Gov. Malloy and Democratic legislative leaders; Republicans were excluded.

Among the few good things that can be said of the budget is it “ends the practice of automatically increasing spending on state programs based on current spending levels,” according to The Associated Press.
It also cuts some funding for state-employee salaries.

Overall, this budget resembles its disastrous predecessors.
House Minority Leader Themis Klarides, R-Derby, and several members of her caucus predicted it eventually will need emergency revisions. It is hard to see how that would help Connecticut compete for the businesses and industries that are key to the state’s economic strength.

And while the budget purportedly doesn’t raise state taxes, it surely will raise local taxes, which may finally cause Connecticut residents who don’t have government jobs to rise up and shout, “No more.”