Republicans Say Malloy’s Budget Doesn’t Strike Right Balance
(Updated 5:27 p.m.) After an more than two-hour briefing, sans donuts and coffee, Republican lawmakers said Gov. Dannel P. Malloy’s budget didn’t strike the right balance between spending cuts and tax increases.
House Minority Leader Lawrence Cafero, R-Norwalk, said he asked some simple questions of Malloy’s Budget Director Ben Barnes, and some of the answers he received are not going to make his constituents happy.
For instance, he asked how many employees currently work for state government. He said he was told approximately 45,000. He then asked if Malloy’s budget passes how many fewer people will work for the state. He said he was told the budget assumes the loss of about 150 jobs. Those job losses are a result of the agency consolidations.
Cafero asked what will happen if through negotiations they don’t achieve $2 billion in cost-savings and concessions from the state employee unions. He says he was told “it will not be made up for in the revenue side, it will be made up for in the expenditure side.”
“I asked if there was any government service we currently have that was being privatized and the answer was ‘No, none,” Cafero said.
When he talked about shared sacrifice, Cafero said his caucus assumed that expenditures would come down and revenues would go up. However, he said what Malloy has shown them thus far is a budget that maintained spending, while revenues increased.
“I don’t think that was the expectation when we started this process,” Cafero said.
While Malloy is not proposing increasing operating expenses above the $17.95 billion current services budget, he is proposing increasing the special transportation fund to $1.75 billion bringing fiscal year 2012 budget to $19.7 billion. The budget increases in fiscal year 2013 to $20.20 billion.
“I’m very concerned about the direction we’re going,” Senate Minority Leader John McKinney, R-Fairfield, said.
He said Republicans and Democrats alike were told taxes would be a last resort.
“Are you telling me you’ve done everything?” Cafero said.
While Cafero understands it was important for Malloy to do this, he said he creates a $500 million surplus over two years in the general fund and $300 million in the special transportation fund.
“Now that begs this question. If you’re a taxpayer you might say, ‘How can you in these tough time leave $800 million on the table, yet raise my taxes $1.5 billion?’,” Cafero said. Or if you’re a union member you might wonder, “how can you ask me for $1 billion in concessions when you’re leaving $800 million on the table.”
Roy Occhiogrosso, Malloy’s senior adviser, and Barnes said the surplus funds set aside in the budget are to transition to Generally Accepted Accounting Principles, and to decrease the state’s debt service.
In the first year of the budget Malloy will set aside $119.2 million and in the second year he will set aside $413.6 million. About $125 million of the surplus over the next two years will be dedicated to GAAP.
Asked if he’s receiving calls already about the $1.5 billion in tax increases, Cafero said “Madone! The phone’s ringing off-the-hook.”
Cafero said people are angry because they feel they didn’t get us into this mess, “You guys, government put us in this mess yet you want us to bail out.”
Democratic lawmakers have said over the past year or more that most of the deficit is attributed to the global economic crisis, but they’re less willing to take responsibility for the large structural budget holes even Malloy says they contributed to over the years.
McKinney said his constituents read about New York Gov. Andrew Cuomo and New Jersey Gov. Chris Christie and wondered why Connecticut can’t cut spending and not increase taxes like those two governor’s have done.
Republicans lawmakers maintained that they want to work with Malloy, but “right now we’re not there,” Cafero said.
If Malloy needs some Republican support in order to get the budget over the finish line Cafero’s not “so sure we started at the right spot.”
Both Occhiogrosso and Barnes maintained that the state’s general fund budget decreases $4 million from the current year to the first year of Malloy‘s budget, which sets general fund spending at $17.95 billion.
In the second year of the budget spending will increase to $18.3 billion, or 2.3 percent. Those numbers don’t include the increases in the special transportation fund, which will increase 11.1 percent or $1.17 billion in the first year of the budget and $1.3 billion, an additional 2.4 percent, in the second year of the budget.