Representative DebraLee Hovey (R-112) joined with House and Senate Republican leaders today in unveiling their legislative agenda for 2011. The measures include massive state government reorganization and downsizing, freezing state employee salaries, and other across-the-board spending cuts to save Connecticut taxpayers billions over the next two years.
Republicans also offered other suggestions on how to deal with the state’s fiscal crisis: rolling back spending to previous levels to save as much as $1.6 billion; a 5 percent reduction in the state’s workforce for approximately $200 million in cuts; and state employee givebacks worth nearly $1.75 billion. Republicans said their proposal is a true “hold harmless” for municipalities. It will preserve municipal aid over the next two years while saving the state approximately $1 billion.
No significant spending cuts have been made over the last two budget cycles, despite the massive drop off in revenue, which has led to the projected $3.5 billion deficit.
“It has long been clear that the legislature can no longer kick the can down the road,” said Rep. Hovey. “Bankruptcy is not an option. Now is the time to make the hard choices and set our priorities. We need to trim government and force it to live within its means and make sacrifices ourselves before we ask the people of Connecticut to sacrifice more than they already have.”
The proposals were part of the seven-point “Common Sense Commitment” that statewide Republicans ran on during the 2010 election cycle; promising to pare down government, eliminate waste and bring jobs back to Connecticut.
Short and Long-Term Savings
The comprehensive set of proposals includes immediate savings for taxpayers, such as the 10 percent pay and perk cuts for lawmakers to realize $3.7 million and elimination of longevity bonuses for state employees to save $30 million annually. The two-year pay freeze for state workers would save $502 million, according to the non-partisan Office of Fiscal Analysis.
Hovey said the long-term restructuring of pension benefits for state employees would require them to contribute more to their retirement packages and would raise the age of when workers could retire.
In 2012 alone, approximately $485 of every Connecticut resident’s income tax payment will fund future state employee retirements and that the state employee retirement system’s $11.7 billion unfunded liability represents approximately $3,325 per man, woman and child in the state. Moreover, Connecticut employees contribute between 0 percent and 2 percent to their retirement plans, whereas other New England states have contribution rates between 5.1 percent and 8.75 percent.
Other features of the Republican plan:
- Merging 43 agencies into 11, including combining all Legislative Management agencies into one entity;
- Reducing the number of managers using private industry standards to determine the proper ratio to rank and file workers;
- Limiting bonding to no more than 10 percent of the state budget. Connecticut borrowed $1.6 billion to pay for operating expenses in the last two years.
- Eliminating the 10 percent corporate surcharge and the business entity tax; and
- Providing tax credits to companies that hire off unemployment rolls.
“It is a great start, and we are hopeful that the majority Democrats and Governor Malloy will take these proposals in the spirit they are offered and join us in working toward common sense solutions,” Hovey added.