The legislators, Sen. Henri Martin and Reps. Cara Pavalock and Whit Betts, made their deficit predictions in a Town Hall meeting at the Bristol Library late last month that was attended by about 40 people.
“Nobody likes to be right when it’s something that hurts everybody. Everyone in the state feels this,” Pavalock said Saturday. “Nobody is happy about it, but recognizing the issue is one of the big hurdles.”
The trio, and Bristol Mayor Ken Cockayne, said Saturday that they were devastated, frustrated and saddened to see that their predictions had come to fruition through Gov. Dannel P. Malloy’s office Thursday.
“It’s frustrating because I know our leadership was looking at the numbers, and even higher ones, before the special budget session in December, but any number is disappointing and scary,” Pavalock said. “What I find interesting is that even Democrats back in December stood up and said no Band-Aids, and were looking at structural changes. It’s time for cuts, not giving raises at a time we can’t give out raises.”
According to the governor’s office, the deficit is primarily due to the lack of expected income tax made largely from small business owners, millionaires and billionaires. The payments make up about 20 percent of the overall budget, and are often linked with stock market performance.
Personal income tax is down by $464 million in the current fiscal year and $878 million in the 2017 fiscal year, according to the governor’s office. The original budget projected income tax would generate $10.36 billion. Now, the estimate is only $9.489 billion.
“For the life of me, I don’t know what to say. I am numb.” Betts said. “I think it’s going to continue to get worse. Frankly I’m very, very scared by this. And, I anticipate more bad news.”
On the local level, Cockayne said, the deficits, while no surprise, are still depressing.
“We all knew this last year when we were talking about the budget and I got attacked for not knowing what I was talking about,” he said. “They’re now predicting we’ll be a billion dollars in the hole. Look what we’ve got … it’s a pretty serious situation looking at the state budget.”
At this point, he added, it’s hard to tell how the city will be impacted.
“How do we adopt a budget without knowing what the state is going to give us?” he asked. “We’re watching it very closely because the state budget is the Bristol budget. We’re watching it diligently and we’re going to be kept in the loop.”
Republicans say the stock market’s poor returns this last year are partly to blame, but the blame is shared by the exodus of wealthy residents moving out of state.
“We’ve been in such denial for so long,” Betts said. “I foresee more people with money leaving the state, and clearly additional businesses that have lost faith in our ability to address fiscal problems. They’re going to areas or states that are more sustainable.”
Martin said he, too, sees a bleak future for the state with the current departure of taxpaying citizens and businesses.
“We who are left are paying the taxes that the Democratic majority forces us to raise,” he said. “There are a lot of people making plans on moving out. Businesses aren’t expanding or building buildings. They can’t trust the state, so it forces people to make decisions. It’s a slow erosion.”
Martin said he was actually speechless over the latest numbers and deficit projections.
“I’m sad, to say the least I don’t know where to even start,” he said Saturday. “It’s their fiscal policies for the last 10 to 20 years that have gotten us to this point. It’s vicious cycle, a downward death spiral.”
Martin and the others agreed that one of the biggest problems right now is the hefty contracts with state employees, some that were just approved last week.
“The Democratic Party is beholden to organized bargaining units and they’ve driven this state into the ground,” Martin said. “We cannot support the labor contracts. They’re giving out raises and benefit packages that are not on par with the private sector. It is unsustainable and now reality has struck them on the head.”
It’s the same problem, year after year, starting in earnest with the 2007-2008 national financial crisis, they said. And change has to come with both big and small concessions.
“It’s frightening. We need to stop the hemorrhaging. We need to bring labor to the table right now,” Martin said. “On an agency level, they need to go to every agency, every department head, every municipality and send the signal that we are serious. Ask each department head to give brief policy changes we can rescind, so that it will help them.”
Betts agreed that immediate change is needed.
“The only way to turn this around is by redefining what the state can afford and sustain,” he said. “The bottom line is we need to create more jobs in the private sector, more high paying jobs. We should all be on same page. We all have this in common.”
If nothing else, Betts added, there is always November.
“The silver lining in all this is that they’re going to see the consequences of their actions in November’s elections,” he said. “Democrats are going to be held accountable.”
Eve Britton can be reached at ebritton@bristolpress.com or (860) 973-1801