Winners and losers in the governor’s budget

The legislative session began in earnest Thursday with the introduction of Gov. Dannel P. Malloy’s budget proposal. Now it’s up to legislators to come up with their own plan or plans (in some years, Republicans, who are in the minority in the House and Senate, issue their own budget proposal), and to pass a final agreement sometime before the session ends May 7.

Here’s an early look at who wins and who loses under Malloy’s proposal. It’s an election year and there’s a budget surplus projected, so perhaps it’s not surprising there are more winners than losers, at least for now.

Winners

Middle-income households: They would share the governor’s proposed $155 million rebate of sales and gasoline taxes.  Individuals earning less than $200,000 per year would receive $55 and couples earning less than $400,000 would receive $110.

Teachers: Connecticut’s 23,000 retired teachers would receive a two-stage break on state income taxes. The governor’s plan would exempt 25 percent of retired teachers’ pensions from state income taxes retroactive to Jan. 1. That exemption would climb to 50 percent in January 2015. Once it’s fully implemented, the tax break would cost the state $23.7 million per year.

Low-income seniors: The proposed budget allocates $6.5 million to add about 12,700 slots to the state’s rental subsidy program for low-income seniors and disabled residents. Individuals, who must earn $34,100 or less to qualify, can receive a rebate ranging from $50 to $700. Married couples, whose joint incomes must not exceed $41,600, can receive between $50 and $900. The proposal reverses a cut to the program Malloy made last year, which was unpopular.

Municipalities: Malloy preserved existing levels of aid to towns and cities, including a $41 million boost in education funding passed last year, and recommended an $8 million increase in the grant for communities that lose revenues tied to tax-exempt colleges and hospitals. The governor also proposed exempting municipalities from a tax on insurance premiums. The Connecticut Conference of Municipalities praised Malloy’s proposals but appealed to lawmakers for relief from other costs, too.

State parks patrons: As part of the 100th anniversary of the Connecticut State Park system, folks will be able to enter any park for free one to-be-determined weekend this summer. No guarantees on rain, however.

Losers

Hospitals: The two-year budget enacted last year set up hospitals to lose hundreds of millions of dollars in state funding. Some legislators, worried that the cuts could translate to lost jobs at hospitals, had hoped that some of the money would be restored this year, but Malloy’s budget proposal didn’t do so. (The administration has said hospitals should make out fine without the state funding since more patients will have insurance as part of Obamacare, although hospitals say that’s not the case.) Hospital officials had hoped that the state would begin phasing out a tax on hospitals that Malloy implemented in his first year in office, but the governor’s proposal would not do that either.

Juvenile girl offenders: The budget provides funding for the state to open a secure facility to house young females who break the law. The facility that will open next to the Connecticut Juvenile Training School, a detention facility for boys in Middletown will house up to 12 girls. Child advocates object to the plan, saying many of these young girls are being locked up for non-serious offenses.

The next governor’s budget director: Malloy’s budget proposal would push the projected post-election deficit to about $1 billion. That means that next year at budget time, there could be a lot more losers.

Comments

comments