Works to Fix Long-Term Fiscal Problems
Hartford – Today House Republican Leader Themis Klarides (R-114) and State Representatives Pam Staneski (R-119) & Charles Ferraro (R-117) joined together with a bipartisan coalition of House and Senate colleagues to approve a two-year state budget proposal with no new taxes that would put a stop to the governor’s draconian executive order cuts to Milford and Orange, restores funding for education and core social services.
The budget document combines elements of the Senate and House Republicans’ multiple prior budget proposals released earlier this year, feedback from Democrat lawmakers and the governor, and factors in the legislature’s passage of the state employee labor concessions deal that is now law.
The House of Representatives passed the bipartisan budget by a vote of 77 -73.
Earlier in the day, three Democratic State Senators broke from party ranks and joined all 18 republican senators to pass the Republican no-tax increase state budget plan.
“This is the first step toward getting the state back on sane fiscal footing and putting Connecticut back on the road to solvency,” Klarides said.
“We owe it to the state of Connecticut to act and have the Governor sign this bipartisan legislation,” Klarides said.
“The bipartisan support tonight of this budget is the first step in restoring economic confidence with our business community and ends the tax and spend practice that has been the norm,” said Rep. Pam Staneski. “this budget funds education, takes care of our most vulnerable, and includes immediate structural changes I urge Governor Malloy to listen to the actions of the legislature and sign this bipartisan compromise to move our state forward.”
“Republicans knew the fiscal crisis our state was facing from the start of the session,” said Rep. Ferraro. “We got right to work crafting a budget proposal focused on prioritizing spending, making structural changes, and rejecting the governor’s reckless cuts to education and municipal funding. Now more than 140 days later, we were able to pass our balanced no-tax-increase budget with bipartisan support. Working together is the only way we will move our state forward, and I want to thank Senator Gayle Slossberg for standing up for what is right and voting in favor of our budget proposal. I hope the governor joins our efforts and recognizes that our bipartisan budget will restore the confidence of Connecticut taxpayers and energize our economy.”
No New Taxes
The revised Republican budget contains no new taxes. It does not increase or expand the sales tax, hospital tax or income tax. It also rejects the governor’s proposal to shift teacher pension costs onto municipalities as such a policy change would likely result in property tax increases. No cell phone or secondary home tax
The Republican budget enacts two policies that will reduce taxes for retirees by phasing in a tax exemption for Social Security and pension income for middle income families. In addition, the Republican budget also restores the entire $200 property tax credit for all qualifying families and individuals. Under Governor Malloy’s tenure this tax credit has been reduced from $500 and we believe that property owners deserve a break on their taxes.
Increases Education Funding
The Republican budget rejects the governor’s devastating education cuts contained in his budget proposal and executive order entirely. It instead includes a fully revised Education Cost Sharing Formula that takes into account factors regarding recent court decisions, enrollment, poverty, wealth and number of English Language Learners, among other factors. This budget dedicates $33.6 million more to education in FY 2018 and $136.6 million more in FY 2019 and phases in a new formula over 10 years. It also establishes a council to analyze and make any necessary changes to the new formula within the next year if deemed necessary. In 2018 all towns and cities’ base ECS grant will either be held harmless or gain more funding.
Municipal Support and Mandate Relief
This budget provides predictable municipal aid so that towns and cities know what they can count on from the state. This plan does not ask towns and cities to pay for teacher retirement costs as the governor’s proposal does. It also implements significant mandate relief for cities and towns to help municipalities achieve efficiencies and pass savings on to taxpayers.
Funds Core Social Services
This revised budget maintains Republican proposals to restore funding for core social services and programs that benefit people most in need. It fully funds day and employment services for individuals with intellectual and developmental disabilities, reopens Care4Kids, protects funding for SAGA that supports disabled residents who are unable to work, funds school based health clinics and family resource centers, restores funding for mental health services among many other programs.
The Republican budget recognizes the importance of a safe, modern transportation system to public safety and economic growth throughout our state. Therefore, this budget prioritizes the state’s transportation needs and stabilizes funding without tolls or new taxes. It implements the Republican “Prioritize Progress” transportation funding plan and stabilizes the state’s Special Transportation Plan by dedicating transportation-related revenues to fund transportation needs and protects monies in the state’s Special Transportation Fund from being diverted for other uses.
The Republican budget lowers taxes for retirees by immediately eliminating the tax on social security and phasing in an elimination of taxation of pension income for single filers with an AGI below $75,000 and joint filers below $100,000. It also helps seniors age in place by restoring funding for core programs such as Meals on Wheels, the personal needs allowance, non ADA dial a ride, and the CT Home Care Program.
Employment and Day Opportunities for the Intellectually Disabled
The Republican budget fully funds employment and day opportunities for new high school graduates over the biennium, and it does not carry forward reductions imposed by Governor Malloy to employment and day opportunities services for the intellectually disabled.
Funds State Parks & Tourism
Acknowledging the multiplier effect that tourism has on our economy, the Republican budget proposes to transfer 1.5% of the current hotel occupancy tax to a new Marketing, Culture and Tourism account. This is not a new tax as Democrats have proposed. Rather, it dedicates a portion of the current tax for its intended purpose to boost tourism funding. This budget also implements the Passports to Parks program that has garnered bipartisan support in the legislature.
Reduces Size of Government
The Republican budget proposal includes overtime savings of 10 percent, a hiring freeze on non-24-hour non-union positions, and makes cuts to the legislature such as reducing the number of legislative committees. The budget also makes targeted spending cuts, 10 percent reductions to certain agency accounts, and rolls forward lapses made last year except for cuts to core services such as grants for mental health and substance abuse and youth service bureau funding.
Includes Structural Changes
In addition to balancing the budget over the next two years, this budget includes policy changes that roll out into future years to achieve significant savings. Changes include items such as a spending cap, bonding cap, municipal mandate relief, and other policy changes for long term savings. The budget also implements pension reform beginning after the SEBAC deal ends in 2027 that will result in some immediate savings as calculated in an actuarial analysis.