CT Senate Republicans Offer Revised Budget, New Options for Labor Savings

May 31, 2017

Senate Republicans Offer Revised No-New-Tax State Budget &

New Options for State Employee Labor Savings

Hartford – Today Connecticut Senate Republicans offered revisions to their two-year, line-by-line state budget proposal with no new taxes that rejects the labor savings deal negotiated by Governor Dannel P. Malloy and state employee union leaders.

Instead of relying on the proposed deal with the state employee unions, which would lock the state into specified benefits including wage increases ranging from 9% – 11% over 5 years, the Senate Republicans identified two alternative labor savings plan options to accompany their two-year budget proposal:

  • Option A: A savings plan that could be achieved by renegotiating a deal with the labor unions.
  • Option B: A savings plan that could be achieved through legislative action alone if the state employee unions do not come back to the negotiation table.

“State employees are hardworking individuals who provide core services to people across our state every day. However, all parties recognize that current state employee benefits are not sustainable,” said Senate Republican President Pro Tempore Len Fasano (R-North Haven). “These benefits far exceed what is received by union employees outside of state government, state employees outside of Connecticut and employees in the private sector. We need to make significant structural changes to benefits in order to protect our state employees from dramatic layoffs and to make sure the pensions and health care benefits the state has promised will be properly funded. Just like we are asking for changes throughout state government, we have to make changes to employee benefits as well. Based on the numbers, the proposed deal made by the governor and state employee unions is not the best deal possible for our state. Therefore our caucus has outlined two different paths we can pursue instead.”

The governor’s proposed labor deal with the state employee unions is estimated to save $1.5 billion over two years, but only $186 million, or 12%, of those savings come from concessions that fall outside of the control of the legislature and that need approval from state employee unions and the governor to pass. By utilizing data from the Office of Policy and Management, the Senate Republican Caucus has calculated that $1.3 billion of the governor’s proposal could be achieved through statutory changes alone without locking the state into the SEBAC contract for another 5 years.

“A labor savings deal that locks our state into these state employee contracts until 2027 and only relies on $186 million in concessions is not a good deal for the state of Connecticut. We would be tying the hands of future legislatures and governors, and putting future funding for budget items such as social services and education in jeopardy in exchange for less than $190 million in labor savings. History has taught us it’s not in the best interest to lock ourselves into a contract for minimal savings,” said Deputy Senate Republican President Pro Tempore Kevin Witkos (R-Canton).

“Our proposed labor savings plans show that there are other options to achieve the significant structural changes we need to balance our budget, pave a path to a more sustainable future and protect jobs,” said Senator Paul Formica, Co-Chair of the Appropriations Committee. “These plans bring multiple ideas to the table so that we can all begin important conversations together.”

“We also need to look at progressive changes that won’t hurt lower paid employees more than higher paid employees,” Sen. Fasano added. “We are proud to offer ideas to implement significant reform and create a fair system, such as a sliding scale for health care benefits based on an employee’s salary.”

Option A lays out revisions to the deal negotiated by Governor Dannel P. Malloy to save at least an additional $657.4 million in state employee concessions achieved through collective bargaining if state unions are open to negotiations. Paired with statutory changes, this proposal would save at least $2.5 billion over two years and would extend the SEBAC contract in exchange for these significant structural changes and savings.

Option B includes approximately $2.1 billion in labor savings that can be achieved through legislative action alone outside of collective bargaining. Beyond the statutory labor changes, this option also includes approximately $160 million in additional changes to the non-labor portion of the Senate Republican budget released earlier this month to resolve the full deficit.

Either of these two options when implemented would balance the Senate Republican “Confident Connecticut” budget. This budget does the following:

  • Does not include new taxes
  • Increases Education Cost Sharing funding by $170 million in the first two years and implements a new funding formula
  • Protects all towns and cities from cuts to statutory municipal grants in year one, either holding municipalities harmless or increasing funds
  • Maintains tax exempt status for hospitals to protect them from a new local hospital tax
  • Preserves core government services by restoring funding for social services and programs that benefit people most in need
  • Prioritizes transportation needs and stabilizes funding without tolls
  • Lowers taxes for retirees and helps seniors age in place
  • Enhances funding for state parks and tourism
  • Streamlines government
  • Provides for structural changes

More details about the proposed labor savings options available in the attached presentation.

Full details on the complete Senate Republican “Confident Connecticut” fiscal years 2018/2019 budget proposal available on www.ctsenrepublic.wpengine.com.

Budget Summary