Malloy releases funds withheld from CT watchdog agencies

Gov. Dannel P. Malloy’s administration relented Friday in its controversial battle to cut the budgets of state government’s autonomous watchdogs — as it has other agencies’ budgets —  to help balance Connecticut’s finances.

But while the administration released the $183,023 it had withheld from the Office of State Ethics, the Freedom of Information Commission and the State Elections Enforcement Commission, it did not concede its authority to capture such funds in the future.

Malloy’s budget chief, Office of Policy and Management Secretary Benjamin Barnes, met Friday afternoon with leaders of the three watchdog agencies.

Budget director Benjamin Barnes visiting the Capitol press room to report on state revenue forecasts.

Claude Albert / CTMirror.org

Budget director Ben Barnes

“Our meeting was cordial and productive, and will lead to greater communication around budget issues impacting their agencies in the future,” Barnes wrote in a statement. “Independent of any legal interpretation of OPM’s authority with respect to budget reduction, I have voluntarily agreed that it is in the best interests of the watchdog agencies and the state to release the holdback of their appropriations. I believe they should have the resources necessary to continue their important missions through the remainder of this fiscal year.”

Colleen Murphy, executive director of the FOI Commission, called the meeting productive and said that her commission is “relieved with the outcome. It means that the FOIC is not in immediate jeopardy of losing more staff or resources.”

Murphy added that despite the budgetary protections legislators enacted for the watchdogs in 2004, “we all agreed to look for ways to generate savings. We don’t feel that we are immune to look out for the state’s well-being.”

She noted that since 2011 the watchdogs have absorbed “significant budget reductions” both in terms of personnel and funding.

The FOIC budget alone was reduced by 14 percent in the fiscal year that began July 1, and that was before the administration withheld additional funding.

The administration specifically had sought $42,549 from the Office of State Ethics, $44,442 from the Freedom of Information Commission, and $96,032 from the State Elections Enforcement Commission. Each of those cuts represents about 3 percent of the respective agency’s full budget for this fiscal year.

The legislature enacted a statute 12 years ago to bar then-Gov. John G. Rowland from cutting the watchdog budgets while two of the three agencies were investigating him. He resigned that year while facing an impeachment inquiry.

But the issue is complex.

The state Constitution grants the legislature authority to draft the budget, and legislators can alter funding to the watchdogs, or to any other agency or segment of the budget, at their discretion, unless barred by other legal commitments, such as a contract.

The governor has authority to unilaterally rescind approved spending in portions of the budget by up to 5 percent. Since the 2004 statute was enacted, governors have recognized the watchdogs are immune from rescissionary authority.

But this latest disagreement didn’t involve rescissions.

The legislature also directs the governor annually to find huge savings in the operations of government after the fiscal year has begun. Lawmakers assumed $189.3 million in General Fund savings would be achieved this fiscal year, and Malloy must apportion responsibility for achieving that savings among the departments and agencies.

To help agencies hit their savings marks, the administration routinely holds back funds, but still can release them if an agency fails to cut costs sufficiently.

So can the watchdogs be subjected to these “holdbacks?” Are they a budget cut, even if the funds are still available — albeit in the administration’s hands?

The Malloy administration said “yes,” while the watchdogs and others said “no.”

Senate Minority Leader Len Fasano, R-North Haven, one of those who objected, asked Attorney General George Jepsen earlier this week to research the matter and issue an opinion. That process was still underway when Barnes made his announcement Friday.

“I’m glad that Governor Malloy finally realizes how absurd and inappropriate his cuts to these three watchdog agencies were,” Fasano said. “The agencies raised an appropriate rejection to the governor’s cuts. But instead of listening to them, he dismissed the concerns of the very agencies we have in place to protect the public’s trust. To see that a complete turnaround from the governor’s office did not come until after I sought a formal opinion from the attorney general on the matter is very telling. It’s sad that it took this long for the right decision to be made, but I appreciate the fact that the governor reconsidered.”

Fasano added that, “I will no longer pursue a formal opinion now that the issue has been resolved. I know some may view this as a tough call. However, next session I plan to talk to the attorney general and look into legislation to strengthen the law so there are no ambiguities.”

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