Capitol Connection: Connecticut’s Nail in the Tire

July 7, 2015

Connecticut’s financial state is like a tire with a nail stuck in it.

Air, like state tax revenue, keeps leaking out.

As our finances deflate, the state looks to fill up with new air and new taxes. Sometimes, leaders may try to patch the hole, but after a while the only real solution is to get a new tire.

Sadly, the state budget finalized this week in the legislature and signed by the governor is full of more hot air and no long term solutions.

To learn more about the budget, click to watch my remarks from the Senate Circle before I voted "No" on the final budget bill.
To learn more about the state’s excessive and dangerous borrowing habits, click to watch my remarks against the state’s bonding bill.

The massive $40 billion budget still hurts the middle class, hospitals, and jobs. It still eliminates the scheduled tax exemption on clothing and footwear under $50 and limits the sales tax free holiday. It still reduces the property tax credit by $100, swiping that directly from the pockets of middle class car and home owners. It still overtaxes our hospitals which has led to significant layoffs and could lead to higher healthcare costs. It still adds new burdens to businesses to the point where other states are looking to court away some of our biggest companies, swiping our current jobs as well as our potential for growth.

Supporters of the budget are trying to paint a different picture. They have called the budget a “historic” change that will provide significant property tax relief, but that simply is not true.

The budget does seek to cap and reduce motor vehicle mill rates in some of our biggest cities. But that relief is limited and far overshadowed by tax hikes in other areas.

Take for example the city of Torrington. Under provisions in the new budget the motor vehicle mill rate in Torrington will decrease from 36.32 to 32. Let’s say you have a car worth the average car value for Torrington ($7,100 according to state data). The mill rate change will save you $30 a year. Great, right? But that is easily overshadowed. If you spend $500 on clothing and shoes under $50 a year, you’ll lose almost $32 right there from the elimination of the sales tax exemption. If you receive the state property tax credit, you’re losing another $100 from that reduction in this budget. If you go to a car wash, you’ll see new taxes. And if you see higher costs at a medical appointment, that’s the ripple effect of higher hospital taxes.

So what do we do? Connecticut needs a new tire. We need structural change in the way the state taxes, borrows, and spends. We need a stable budget with no leaks so that we won’t have to go down the path of raising taxes again. The reality is this budget leaves us with a projected deficit two years from now – meaning we are already facing that path unless we make serious changes.

It’s important to know the truth about what this budget will do to our state so that you can help urge lawmakers to make better policy decisions in the future. Thank you to everyone who already spoke out and contacted your legislators throughout the entire budget process. Your voices kept the pressure on that led to some needed patches.

While the final budget is still not the ‘new tire’ solution our state needs, I think it’s clear that people won’t put up with patch work much longer.