Gov. M. Jodi Rell challenged the legislature Wednesday to adopt $38 million in cuts to this fiscal year’s budget to maintain the emergency winter heating assistance program at last year’s level — and to alleviate a $33 million shortfall legislators created by gambling on extra federal aid.

Writing to leaders of the Appropriations Committee, Rell suggested reductions to municipal aid and other popular programs involving early childhood education, tourism and economic development, environmental protection and mass transit.

But the proposed cuts also reached into more obscure areas traditionally avoided, touching everything from legislators’ stationary to mileage and other expense reimbursements for lawmakers, judges and Executive Branch staff.

“Many of these dollars have not yet been spent,” the governor wrote. “Some represent a partial reduction in funding for programs that can still operate well at lower levels.”

The lame duck Republican governor has been locked in a battle with the Democrat-controlled legislature for two months now over the Low Income Home Energy Assistance Program. Largely supported with federal dollars, LIHEAP helps low-income families pay for winter heating.

Rell urged lawmakers to tighten program eligibility and benefits in late September, anticipating reduced federal funding. Legislators opted not to do so, noting a projected 18,800 families would lose assistance and thousands more would receive reduced aid. LIHEAP helped a record-setting 82,956 households pay their heating and other energy bills last winter.

But legislators also declined to appropriate any additional state dollars for the program. The administration estimates that unless $33 million in new funding is found, all budget money will have been pledged to needy households by the end of November, leaving the Department of Social Services and the nonprofit community agencies that assist them unable to process any more requests for assistance.

The governor and legislature authorized $956 million in borrowing – rather than tax hikes or spending cuts – to prop up this year’s $19.01 billion budget, a move that earned them bipartisan criticism from many candidates for state office this past fall, including Gov.-elect Dan Malloy.

Because last fiscal year’s budget ended with a larger surplus than expected, Rell now estimates only about $650 million in borrowing is needed this year, and she opposes borrowing above that level to close the LIHEAP gap.

“Make no mistake,” Rell wrote. “That is what we must do and what our taxpayers require of us in order to pay for fuel assistance at these higher, mandated levels.”

Nearly half of the $38.9 million in cuts Rell proposed would affect town aid and related funding, traditionally one of the most politically sensitive components of the budget. Legislators haven’t reduced town aid in the midst of the fiscal year since February 2003, when $43 million was cut as part of a much larger deficit-mitigation effort.

Rell’s plan would cut $19.3 million, targeting grants that fund student transportation, health and welfare services for private-school pupils, and public libraries, as well as reimbursement to communities for lost property taxes tied to exempt manufacturing equipment.

“To cut municipal aid in mid-year would be unconscionable, as would be not finding a less destructive way of making sure people in need are kept warm this winter,” James Finley, executive director of the Connecticut Conference of Municipalities, said Wednesday.

Other major targets of cuts include:

  • $5.5 million to be saved by eliminating commuter rail service to Danbury, New Canaan and Waterbury and by canceling expanded service on the Shoreline East line.
  • $3.2 million saved by cutting medical services to prison inmates.
  • $3.1 million from tourism grants and promotion.
  • $2.3 million from underground storage tank clean-up and other environmental programs.
  • $2.2 million from small business incubator, job training and workforce development programs.
  • $1 million from Tweed-New Haven Airport.
  • $1 million saved by suspending funds for a planned support program for homeless youth.
  • And $428,000 from early childhood development programs.

The governor also recommended saving $2.5 million by cutting accounts for legislative stipends and mailings, and by reducing mileage and other expense reimbursements for all three branches of government.

Sen. Toni Harp, D-New Haven, and Rep. John Geragosian, D-New Britain, suggested to the governor this week that additional funds for heating assistance could be found if the administration reined in overspending in several key agencies.

Rell’s budget office reported $233.4 million in projected cost overruns spread across eight agencies, with nearly three-quarters of the problem tied to increased demand for social services.

Leaders of the Democratic majorities in both the House and Senate also have said they don’t plan to call for a special session in December to appropriate additional funds and have said they hope funds can be transferred, temporarily from some other program.

Keith has spent most of his 31 years as a reporter specializing in state government finances, analyzing such topics as income tax equity, waste in government and the complex funding systems behind Connecticut’s transportation and social services networks. He has been the state finances reporter at CT Mirror since it launched in 2010. Prior to joining CT Mirror Keith was State Capitol bureau chief for The Journal Inquirer of Manchester, a reporter for the Day of New London, and a former contributing writer to The New York Times. Keith is a graduate of and a former journalism instructor at the University of Connecticut.

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