As the 2012 legislative session approaches its conclusion on May 9, the lawmaking process is starting to unfold at a faster pace as some of the biggest issues facing us this year are being addressed.
When this session began, the state’s fiscal health was in question and revenue projections plummeted as the economy continued to suffer under the stifling tax burden. I made it one of my priorities this session to help get Connecticut’s fiscal house in order and afford residents some much needed tax relief.
Following the largest tax increase in history last year, we were assured by the Governor that we would end this fiscal year with a surplus. However, that surplus quickly evaporated into thin air as state spending has again gone up. Now residents are left wondering how the Governor will end the year in the black without borrowing or raising taxes, as he has promised to do.
According to the Governor’s Office of Policy and Management, the state is currently facing a $141.9 million deficit. The deficit is caused by higher than expected tax refunds, additional Medicaid costs and lower than expected income tax receipts.
This news will likely impact next year’s budget as well given that the Governor and his Democratic colleagues added more than $300 million in spending for next year.
With only two months remaining in this fiscal year, most state money has already gone out the door. The Governor assured the public over and over again that he would manage the state’s cash responsibly and we would not, again, be contending with mounting debt.
I have always believed that state government should handle its finances just like our families do – spending no more than we make and borrowing only what we can afford to pay back.
When the Governor proposed his own set of budget adjustments earlier this year, Republicans also unveiled an alternative budget which proposes a way to provide vital services and, unlike the Governor’s budget, gives tax relief to residents.
The spending level in this alternative budget adjustment plan is $28 million less than the adopted budget and $342 million less than the Governor’s proposed budget. The Republican alternative cuts taxes by $310.5 million, while the Governor’s budget does nothing to reduce the current tax burden.
Additionally, the alternative budget appropriates $100 million to enhance state fraud prevention and recovery, whereas the Governor’s budget does not allot for enhanced funding for these efforts. And as this has been deemed the “education session,” the alternative budget maintains current funding levels for private college scholarships, whereas the Governor’s budget cuts that allotment by $5 million.
Other key differences in the Republican proposal include:
- Eliminates public financing of state elections
- Suspends funding for the New Britain-Hartford Busway
- Restores the sales tax exemption on clothing and footwear that costs less than $50, saving taxpayers $141.7 million
- Increases the middle class property tax credit from $300 back to $500
- Restores the sales tax exemption for non-prescription drugs
The alternative budget was voted down by Democratic lawmakers in the Appropriations Committee on a party line vote. Despite this setback, my minority colleagues and I will continue our efforts to promote this budget and its components, showing an alternative to tax-and-spend policies without compromising vital services or the safety net.