REP-AM: Put brakes on ‘off-budget’ idea

May 20, 2021

An editorial from the Republican-American published May 12, 2021.


The Connecticut legislature’s influential Finance, Revenue and Bonding Committee has proposed the “Connecticut Equitable Investment Fund” (CEIF). If CEIF becomes a reality, it will operate “outside of the legislature’s control,” the Republican-American reported May 11. The committee is dodging its duties and the state’s constitutional spending cap. Hats off to House Republicans, and to House Speaker Matt Ritter, D-Hartford, for their firm opposition.

If CEIF comes into being, it will finance urban-centric social programs, according to a May 11 report from the Hartford-based Yankee Institute for Public Policy. CEIF could take in $1 billion a year; the annual state budget is well in excess of $20 billion. It would come via “new and increased taxes on capital gains, digital advertising, sports gambling, marijuana sales and a second income tax on the wealthy,” according to Yankee investigative reporter Marc E. Fitch.

This is consistent with the approximately $46 billion 2021-23 budget approved last month by the Finance, Revenue and Bonding Committee, which is led by Rep. Sean Scanlon, D-Guilford, and Sen. John W. Fonfara, D-Hartford. Gov. Ned Lamont consistently has opposed targeting wealthy Connecticut residents for tax increases.

While aiding Connecticut’s cities is a worthy goal, CEIF is the wrong vehicle for reaching it. CEIF would undermine basic tenets of state government.

An “investment council” would oversee CEIF. This council would be led by the governor; and the state treasurer and the governor’s budget director would be ex-officio members, according to the Republican-American. Reporter Paul Hughes indicated the six remaining seats would be held by members of the public – two appointed by the governor, two appointed by the Senate president pro tempore, and two appointed by the House speaker. Since CEIF would receive a substantial taxpayer subsidy each year, there should be a sizable role for legislators, the direct voices of the people. This setup, however, gives virtually no role to lawmakers. At best, it would amount to a dereliction of duty by the legislature and at worst, it would open the door to cronyism, as if Connecticut hasn’t had enough of that.

Similar points were made by Speaker Ritter and by House Minority Leader Vincent J. Candelora, R-North Branford, who emphasized the current arrangement goes against Connecticut’s constitution. Rep. Candelora has asked state Attorney General William Tong for a legal opinion.

But that is not all. Mr. Fitch indicated CEIF spending would not be subject to Connecticut’s spending cap. Such gimmickry feeds the spending habit that has gotten the state in trouble. It is reminiscent of the “off-budget” maneuvers seen in the 2013-15 and 2015-17 budgets approved by Democratic Gov. Dannel P. Malloy and Democratic-controlled legislatures. Those budgets didn’t stabilize Connecticut’s finances, as evidenced by the steady stream of deficits in subsequent years, including the $1.6 billion hole for the 2021-23 biennium.

The CEIF arrangement is outrageous. Rep. Candelora and his caucus, as well as Speaker Ritter, should keep up their opposition. Everyday Connecticut residents should let Rep. Scanlon, Sen. Fonfara and their colleagues know the current version of CEIF is unacceptable. It would be nice if Gov. Lamont, too, would firmly speak against it.