‘Capitol Connection’ – Governor Offers Budget Recommendations

Over the next few months, legislators will review the governor’s budget recommendations and likely make additional changes.

From the Office of State Senator Kevin Witkos 

During an address before the joint session of the General Assembly last week, the governor announced his proposed budget for the next two years. Senators and representatives came together in the Hall of the House to listen to the governor’s plan that focused on jobs and the economy, education, municipal aid, the safety net, streamlining state government, investing in infrastructure and adopting greater transparency. While it remains to be seen whether the budget would achieve these goals, many have expressed concerns over increased levels of borrowing and spending. 

In this week’s column, I would like to share my initial take on some of these issues. Overall, the governor’s proposed budget will cost more than $43 billion over two years. While the governor has claimed that it will cut spending, the proposed budget grows by nearly 10 percent or $1.8 billion during that time. Another concern is that this budget relies upon more than $750 million in additional borrowing to simply keep up with our daily operating expenses.

As part of the proposed budget, changes to the tax code will be coming. While the governor claims that there are no new taxes in the budget, there are in fact three taxes that were going to “sunset” or expire later this year that will be extended. These include the generator tax, corporate tax and insurance premium tax.

The governor is also proposing new exemptions for taxes on motor vehicles and clothing under $25 in the second year of the budget. While these exemptions seem promising and would help provide relief to Connecticut families, it is important to understand these proposals in context. If you recall, Governor Malloy originally made clothing under $50 taxable. Now, it seems that he is taking credit for repealing a tax that he himself pushed through the legislature as part of the largest tax increase in state history in 2011.

The exemption for motor vehicles would apply to the first $20,000 of assessed value, which would allow car owners to keep more of their own money. However, they could also be forced to pay more for residential property tax because the motor vehicle tax is a major part of some town budgets. In response to this loss of revenue, local officials would have to find new sources of revenue through increased taxes on residential or commercial properties or spending cuts.

On jobs and the economy, the governor will be continuing previous efforts to attract businesses to our state by offering huge investments to relocate operations here and create jobs. During the first half of his term, we have seen the “First Five” program expand and offer hundreds of millions of dollars to large companies, such as Cigna, ESPN, NBC Sports and Alexion Pharmaceuticals. Another program to encourage bioscience promised additional state funding to bring Jackson Labs to our state. While I have criticized some of these efforts, it appears that the next two years will see similar initiatives and many are concerned over this extraordinary level of borrowing and spending.

On a more positive note, it appears that the budget takes steps to reduce the size of state government by eliminating an additional 7 agencies. This will bring the total number to 53 agencies and is projected to save about $5.5 million per year.

Building on last year’s education reforms, the budget would increase state funding for schools through Education Cost Sharing (ECS) aid. This program typically provides an additional source of funding for public Kindergarten through grade 12 schools in an effort to support poorer school districts and close the achievement gap.

This increase is pegged at over $152 million, but questions have been raised over this proposal. Some are concerned that this increase will modify how state funding is provided to our municipalities, such as the payment in lieu of taxes (PILOT) program. Some have criticized this aspect of the budget simply as a“shell game” that will negatively impact our towns and cities.

Over the next few months, legislators will review the governor’s budget recommendations and likely make additional changes. Thanks to the legislative process, including committee meetings and public hearings, elected officials and members of the public can often have an important impact on how the budget is developed. If you would like to review the governor’s budget proposal, please visit the governor’s Office of Policy and Management (OPM) website at www.ct.gov/OPM.

Sen. Witkos (www.SenatorWitkos.com) represents the 8th Senate District, including the communities of Avon, Barkhamsted, Canton, Colebrook, Granby, Hartland, Harwinton, New Hartford, Norfolk, Simsbury and Torrington. He can be reached by phone at 1-800-842-1421 or by email at Kevin.Witkos@cga.ct.gov.

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Canton Taxpayer February 18, 2013 at 03:01 PM
Only in government can a 10% increase in spending magically become a decrease...when can we vote this math-challenged joker out?!? Even better...I love the way the Town of Canton decided this is a great "borrowing environment"....did they not know about the car taxes being eliminated? Did they not think perhaps the grand list would stagnate? Did they not know state reimbursement for schools would go down? If not, Town of Canton officials need to be removed....immediately.
Bob February 18, 2013 at 04:47 PM
Lets not forget by eliminating the motor vehicle tax you loose the exemption on your state tax return. Thus you will pay more state income tax.
Canton Taxpayer February 18, 2013 at 10:49 PM
You can only deduct $300 as it is--we're already being screwed there....
Elaine February 19, 2013 at 10:09 PM
I would hope that the legislators will be reviewing this budget and making changes! Actually, I wish that the legislators would build a huge bonfire in Bushnell Park and burn every copy of this budget and start over with something that isn't a slap in the face to every taxpayer. But, well, we know that isn't going to happen and our elected officials will continue to spend us into bankruptcy. Do I hear a fiddle playing somewhere?
Robert Kalechman February 20, 2013 at 06:23 PM
A tax cut in these time is just great not all citizen enjoy the privilege of owning a home and some own a larger house and pay more tax to do so but here again our State Senator just don't get it do they sorry Senator but your not for the middle class and those of us who think you are are just kidding our selves as we do with the seven elected democratic members ot the U.S. Congress On gun control you will vote on the side of the well to do and the well connected in other words you still own a gun or is it guns and the Well to do and well connected will always be able to buy guns but the middleclass will not Still waiting for the official report on Newtown and to date their is none I wonder why the truth story will never be told who gave the orders to wait or when to enter and fire and your voting in your hearings you sat inside the L.O.B warm while. other waited in line in the snow and cold that should tell you State Senators something Senator please stop your postulating and the Dog and Pony shows going round about Newtown and State and Federal gun control laws two wrong still will not make you right one other thing will you have loaded guns inside your saloon in Canton CT. when you open ?


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