Fasano, Klarides Again Call for Leaders to Work Together on Budget Solutions

December 3, 2014

Hartford – State Senator Len Fasano (R-North Haven), incoming Senate Minority Leader, and State Representative Themis Klarides (R-Derby), incoming House Minority Leader, are again seeking support from legislative leaders to hammer out a bipartisan budget solution addressing the state’s deficit and financial planning.

Today the incoming GOP leaders sent a letter to fellow leaders asking for a sit down meeting in light of Comptroller Kevin Lembo’s reporting on the deficit situation.

“Although the comptroller shows ‘concerns’ over higher spending and the failure to take advantage of the federal resources he, like others, fails to really grasp the true deficit facing this state,” wrote Fasano and Klarides.

The letter cited the comptroller’s reported deficit of $44.8 million, after taking into consideration the governor’s rescissions totaling $54.7 million. However, Fasano and Klarides pointed out that this number fails to include additional budget shortfalls including:

  • $31.8 million for retiree healthcare costs
  • $10.5 million for the Department of Corrections
  • $1.5 million for active state employee healthcare costs

They also noted that both the comptroller and OPM’s reported deficit numbers assume an additional $40 million collection of random, unidentified tax initiatives.

“Although OPM acknowledged during the Fiscal Accountability presentation that these accounts are ‘potential watch areas’ and indicated that they will ‘keep an eye on them’ through the fiscal year, it is time to be more proactive given the severity of the deficit in future years.”

Fasano and Klarides also expressed concerns about Treasurer Denise Nappier’s reliance on a controversial bonding strategy to balance the books with funds gained through borrowing. Premium upfront payments have been accepted to fund state expenses, and in exchange for these funding sources the state is responsible for a higher interest rate over the life of the bonds. The Office of Fiscal Analysis’ projections show that the state’s debt service line item is poised to lapse $105 million due to the state receiving bond premiums above what was already assumed in the budget.

“Rather than come up with a plan that would proactively reduce our debt this year, the treasurer’s plan is to burden future taxpayers with these higher interest rates…In light of the almost $3 billion deficit we face, this ‘plan’ is nothing short of appalling,” Fasano and Klarides said.

The GOP leaders emphasized the need to act quickly before the situation worsens and the importance of working in a bipartisan manner.

“It’s been said that this administration won’t ‘kick the can down the road’ but instead will ‘pick it up.’ But we don’t foresee this happening unless we work cooperatively across the aisle to change course. Together, not only can we ‘pick up the can’ but we can make real changes that will help place Connecticut back on the right track,” they said.