Sen. Kane: Moving more $$$ outside the spending cap would break the promise made to CT taxpayers 24 years ago.

December 15, 2016

Sen. Kane: Moving more $$$ outside the spending cap would break the promise made to CT taxpayers 24 years ago.

Proving just how difficult it may be for a supermajority of the legislature to approve a spending cap, a 23-member commission that has been working on a recommendation for close to a year was unable to reach an agreement.

The Spending Cap Commission was able to find more consensus on the definition of inflation and personal income, but when it came to what spending should fall under the cap they couldn’t quite get there. The proposal failed by an 11-12 vote earlier this week.

William Cibes, former Office of Policy and Management secretary under Lowell P. Weicker and co-chair of the Spending Cap Commission, said despite their best efforts they were unable to reach agreement. He said one proposal would pick up votes, while other proposals would lose votes.

At the outset of Monday’s meeting, Cibes felt he would be able to find consensus for a proposal that phased in the unfunded liability in the pension system, but his hopes were dashed when Democratic members of the commission voted against the measure.

Sen. Rob Kane, R-Watertown, said moving more money outside the spending cap is not consistent with the promise made to Connecticut taxpayers 24 years ago. The proposal, which ultimately failed, would have resulted in an additional $635.9 million being exempted from the spending cap just next year.

That being said, Kane appreciated the phase-in of the unfunded pension liability.

Former state Rep. Patricia Widlitz, who co-chaired the commission, said she thinks the pension piece was the most important piece they were able to get across the finish line.

“We did come to some movement and agreement on that,” Widlitz said.

She said she wishes they could have come to agreement on the other issues raised by Republican lawmakers and business officials, but they just couldn’t get there.

“The major accomplishment is the pension piece,” Widlitz said.

Rep. Jonathan Steinberg, D-Westport, said it’s possible that they would never reach consensus even if they continued to meet and discuss the issue. He said at this juncture there are still “so many question marks” that he was unable to vote for the final proposed definition of what qualifies as an expenditure.

Steinberg said it’s “purely a symbolic vote” because it doesn’t send a clear message to the legislature.

Sen. Joan Hartley, D-Waterbury, said she was conflicted because the additional $635.9 million that will fall outside the cap next year seems “counterintuitive” to what brought the group together in the first place. She also struggled with language that would exempt spending on distressed municipalities from the spending cap.

Hartley ended up voting against the proposal.

And even though they couldn’t reach an agreement, the legislature will receive a narrative of their agreements and disagreements on the various aspects of the spending cap.

“I regret we weren’t able to come to a conclusion,” Cibes said. “I think the proposal that were recommended could serve as a basis for action by the General Assembly.”

Sen. Michael McLachlan, R-Danbury, said he was unhappy they were unable to come to an agreement.

“I also am disappointed we haven’t accepted the fact that our work has to survive a supermajority in the legislature,” McLachlan said.

He said it will be a long fourth down to get it over the goal line.

The cap was instituted back in 1992 to quell anger over implementation of a state income tax in 1991. It is calculated by tying increases in state spending to either personal income growth or the rate of inflation. Over the past 24 years, lawmakers and governors have agreed to exceed the cap 8 times.

In 2013, Gov. Dannel P. Malloy and lawmakers were unable to get the votes they needed to get around the spending cap, so they intercepted federal Medicaid reimbursements before they reached the general fund. The move essentially exempts them from being counted against the spending cap. Republicans opposed the move that year, calling it a “gimmick.

In 2015, the co-chairs of the Appropriations Committee unsuccessfully attempted to expand the definition of the spending cap without legislative approval or a legal opinion. Later that same year, Attorney General George Jepsen said the definition of the spending cap the lawmakers have been using has “no legal effect.”