With the concession deal ratified by unionized workers and roughly 2,800 layoff notices now revoked, the ugliest elements of Gov. Dannel P. Malloy’s budget-balancing alternative to givebacks have been put away.
But even though most of Malloy’s $1.6 billion concession plan has been approved, that doesn’t mean every option raised last month when concessions still hung in the balance has been scrapped.
Metro-North train in Stamford: Fare hikes are still on the table
More than 128 layoffs were ordered for non-unionized personnel, including several employees at government watchdog agencies, whose leaders insist they were supposed to be statutorily insulated from such cutbacks. Malloy’s budget agency, the Office of Policy and Management, has offered all agencies a chance to appeal for these positions to be restored but already has indicated some will remain vacant.
And commuter rail and bus service fare increases ranging between 10 and 15 percent also remain a possibility. The administration, which included these hikes in its July 15 plan to balance the budget in the absence of concessions, is moving forward with the process and conducting public hearings on these proposals, though one key official said no final decision on whether to implement them has been made.
“We still have a lot of work to do with this budget,” said Benjamin Barnes, the secretary of the Office of Policy and Management.
Though the $20.14 billion budget adopted in June for the current fiscal year is balanced on paper with the concession deal, there is no guarantee it will yield the planned savings targets: $700 million this fiscal year and $900 million in 2012-13.
Nearly 25 percent of this year’s concession savings, about $170 million, is supposed to come from joint labor-management panels working to cut costs through as-yet-unidentified efficiencies in health care, technology, and across state government in general.
Mark Ojakian, Malloy’s chief negotiator on the concession package, said Friday that the health care effort already is underway, while teams addressing technology and general government costs will get started in the next few weeks.
Those efforts all were supposed to be underway by Sept. 1, Ojakian said.
But a wrench was thrown into the schedule in mid-June when the State Employees Bargaining Agent Coalition rejected the concession plan on the first vote. Panelists to serve on potentially the most challenging cost-savings assignment — a general government efficiency program that must find $90 million per year in savings — haven’t even been named yet.
“We’re still working out who’s going to be sitting on that,” Ojakian said.
The administration also is counting on saving more than $200 million this fiscal year through a new state employee wellness plan, another savings target in the concession package that critics have called too aggressive.
Further complicating matters, the legislature tasked Malloy when this year’s budget was adopted with finding over $112 million in undefined savings in addition to those tied to the concession plan.
Malloy reminded all of his department heads during a meeting this past week of the crucial need to control spending.
“You have got to begin the task in earnest,” the governor said. “You have got to demonstrate your willingness to drive efficiencies.”
That means no reasonable idea to make government more efficient can be ignored, Barnes said.
The administration ordered 128 layoffs earlier this summer for non-union personnel. About half of them were connected with agency consolidations approved by the legislature in June. The remainder were linked to efforts to cut costs when it appeared union concessions wouldn’t be forthcoming.
“We haven’t finalized our decision-making on these” jobs, Barnes said. “But we’ve invited each department to submit a plan” to try to reclaim those jobs it deems are most crucial.
This position already has sparked criticism from the state’s three chief watchdog agencies, which were rolled on July 1 — along with six others — into a new, unified Office of Governmental Accountability.
The heads of the Freedom of Information Commission, the Office of State Ethics and the State Elections Enforcement Commission, have said they shouldn’t have to ask the governor to restore positions in their budget. Malloy laid off three non-union watchdog jobs and to date has not allowed these agencies–now divisions within the OGA- to fill newly vacant posts.
That’s because at the height of the scandal that drove former Gov. John G. Rowland from office in 2004, state lawmakers legally insulated the freedom of information, ethics and elections enforcement agencies with a measure sparing them from any emergency cuts after the budget had been adopted, arguing this was essential to keep government open and honest.
The watchdog agencies say Malloy is violating at least the spirit, and possibly the letter of that law, by laying off their staff and using the governor’s control over state hiring rules to prevent them from using their approved budgets to fill the positions.
Malloy also took some heat last month when his alternative budget included cuts to subsidies to force rate increases that included:
- 14 percent for the Shoreline East rail commuter line.
- 15 percent for the Metro-North rail commuter line.
- And 10 percent for the CT Transit bus service.
Jim Cameron, chairman of the Connecticut Metro-North Rail Commuter Council, said the rail subsidy cuts amounted to a “hidden tax increase.”
Cameron said that for the typical Metro-North passenger purchasing a $300-per-month rail pass, that’s an extra $45 per month, or $540 per year. Bus service riders would face an extra $4.50 added to the $45 price for a 31-day pass.
Barnes said those proposals were “clearly very aggressive,” but reasonable when trying to balance the budget without concessions.
Why are they still on the table now?
“I know that that’s unpopular,” Barnes said, noting that after hearings are held it will be determined if the full proposed rate hike, or something less is needed. He added that the administration also inherited serious fiscal problems in the special fund that maintains Connecticut’s transportation network.
According to Department of Transportation data, the number of structurally deficient bridges is at its highest level since 1993. And there are more potential problems in the near future: Much of the interstate highway system in this state was built in the 1950s and 1960s, and many of the bridges that serve it have a 40- to 60-year life span. The state maintains about 3,900 highway bridges and about 200 rail bridges; just over 2,850 were built prior to 1970.
Further complicating matters, the DOT projected last year a $926.4 million gap between the cost of highway, bridge and transit projects planned through 2014 , and the level of anticipated funding available.
Malloy, who decried the low priority transportation has received under past administrations, has made progress reversing that this year. The new budget redirects nearly $40 million in fuel and other revenues from general government operations and into the transportation fund.
“We’d like to get the fund to a sustainable place,” Barnes said.