Democrats strike deal on deficit; Senate to vote tonight, House tomorrow

The Democratic majorities in the state House and Senate reached a compromise this afternoon on a plan to eliminate most of this fiscal year’s $518.4 million deficit, relying chiefly on restoring a gross revenues tax on hospitals and reversing a January reduction in the levy on wealthy estates, sources said.

The Senate is scheduled to vote tonight on the plan. The House is notifying its members they will vote Saturday.

The deal, which came one day after Senate Democrats vowed to vote tonight on their own deficit-mitigation plan without House support, also would cancel longevity bonuses for senior, non-unionized state employees and cut at least $100 million in contributions to the state employees pension fund.

It also includes a package of cuts to social services, health care, job training and youth support programs worth more than $50 million both this fiscal year and next – cutbacks that House Democrats had refused to accept as recently as Thursday.

It was not clear immediately whether the plan would be acceptable to Republican Gov. M. Jodi Rell, who largely has opposed tax hikes to wipe red ink off the state’s books.

The deal represents an abrupt about-face for House Democrats, who had objected to the mitigation plan by Senate Democrats. On Thursday, Democrats on the Appropriations Committee voted to increase spending in Rell’s proposed budget for next year.

“Yesterday, they were embarrassed,” said House Minority Leader Lawrence F. Cafero Jr., R-Norwalk. “This is all public relations.”

Cafero said he was notified at 4 p.m. he needed to round up his members for a Saturday session.

“It’s reprehensible,” he said.