Locals skeptical of rosy economic forecast [Rep-Am]

June 12, 2015


TORRINGTON — Catherine Smith, commissioner of the state Department of Economic and Community Development, painted a rosy picture of the state’s economic prospects Thursday during an appearance before the Northwest Hills Council of Governments.

But elected officials in the council, which represents 22 municipalities, and two Republican legislators in attendance were skeptical. They said the $41.3 billion budget for 2015-17 approved by the Democratic-controlled legislature is proof the state isn’t serious about getting its economic house in order.

“No doubt what sparked this discussion was the increase in taxes related to the budget,” Barkhamsted First Selectman Donald S. Stein, council chairman, said of the budget’s $2 billion in tax increases. “It’s a huge frustration to us that taxes will be raised that much. What I’m hearing is that people want to see a decrease in spending.”

State spending would rise by more than 7 percent over the two years. Local elected officials, who said they pinch pennies to balance their budgets, found that unconscionable.

“We manage our budgets well and don’t borrow money to take care of operating expenses like the state does,” Litchfield First Selectman Leo Paul Jr. said. “We seize every opportunity not to increase taxes because that’s what’s important to us.”

State Senate Minority Leader Pro Tempore Kevin D. Witkos, R-Canton, and state Rep. Jay M. Case, R-Winchester, cited the exclusion of Republican legislative leaders in budget negotiations between Gov. Dannel P. Malloy and Democratic legislative leaders as a reason to condemn the new budget.

“WE HAVE A TIRE WITH A PUNCTURE and all we do is put air in it,” Witkos said of the state budget. “It fills up and then goes back down, so now we’re back to where we were four years ago. Until we fix the tire, we’re not going anywhere.”

There should be a bull’s-eye on the cost of state government, Witkos said.

“We haven’t attacked state government,” he said. “I wish we could run the state like you do your communities.”

Case said he knows legislators whose votes of support for the budget were “bought” with financial aid to their districts. The budget, Case noted, also adds 135 new state employees at a time when state government should be getting smaller.

The Department of Economic and Community Development has implemented strategies designed to improve the state’s economic health, Smith said. Ninety percent of the department’s effort, she said, involves working with companies to make it easier to do business in the state.

Priorities include improving highways and other infrastructure, and making government smaller and more friendly, Smith said. She admitted Connecticut’s economy is in the bottom 25 percent among the 50 states.

“Obviously we have work to do, and a lot of it involves listening to what is working and what is not working,” she said. “We’re doing what we can to build a great state using our strengths, which include a highly educated workforce.”

WITKOS SAID SMITH’S ASSESSMENT of the state’s economy is way off.

“If you look at the economic indicators, I’d say we’re dead last,” he said. “Our GDP is lagging so far behind the other New England states and the rest of the country.”

Discussion also touched on threats by General Electric, Aetna and the Travelers Companies Inc. to leave the state if tax increases in the new budget become law.

“The tax policy is hitting them hard, and for the first time in 25 years, they’re speaking out,” Witkos said. “The full-court press they’re putting on is unprecedented.”

Losing such large businesses would case a ripple effect that would reach Litchfield County, Case and Witkos said.

“We have manufacturers in the Northwest Corner that are feeders for these large companies, and the prospect of losing that concerns us,” Case said.