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House Republicans Question Constitutionality of Proposed Equitable Investment Fund

Posted on May 10, 2021


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HARTFORD—House Republicans are questioning the constitutionality of the “Connecticut Equitable Investment Fund” included in legislation approved by Finance Committee Democrats recently and today asked the state’s attorney general to weigh in on the matter.

“Democrats have steered Connecticut toward uncharted territory by creating what I’ve likened to an offshore bank account, proposing to raise new revenue they would channel into to an off-budget account with no legislative oversight,” House Republican Leader Vincent Candelora said. “This outrageous proposal undermines the legislature’s money committees, and residents will be furious when they realize the projected $1 billion in revenue will end up under the control of just nine people—only two of them elected and accountable to the public.”

Candelora and House Republicans wrote Monday to Attorney General William Tong, asking him to review sections of H.B. 6443 that pertain to the Connecticut Equitable Investment Fund (EIF.) Voted out of the Finance Committee on April 22, the legislation specifies that this new fund would hold revenue from a new (voluntary) payroll tax, a new consumption tax, a new digital advertising tax, new taxes on recreational cannabis and cannabis products, and a diversion of future revenues generated by any form of online gaming.

The EIF would be controlled by a council that includes: the Governor, the state’s Treasurer, Secretary of the Office of Policy and Management, and six members of the public appointed by the Governor, Senate President, and Speaker of the House.

“House Republicans maintain our viewpoint that increasing taxes on Connecticut residents and businesses will only slow our state’s economic recovery, but we’re particularly troubled by the long-term implication of mechanics of this proposal,” Candelora said. “This is a naked attempt to maneuver around the spending cap, and those backing this slush fund concept have no problem abdicating the legislature’s constitutional budget-making authority to others. We hope Attorney General Tong looks at that issue closely before Democrats cement what looks to be their new approach to budgeting that, believe it or not, is less transparent than ever.”