Special session on budget explodes into dozens of topics

The General Assembly adopted dozens of initiatives in special session Tuesday evening and early Wednesday including another job growth plan, controversial measures aimed at minimum state police staffing and licensing for tobacco shops, and a new phase-in option for municipal property revaluation.

As majority Democrats in both chambers adopted scores of measures, Republicans cried foul, arguing a session that was supposed to be limited to policies needed to implement the new budget had expanded dramatically.

“Is that democracy?” House Minority Leader Lawrence F. Cafero Jr., R-Norwalk, asked after counting more than 146 different concepts covered in two omnibus policy bills.

One-third of those concepts never had been discussed in public hearings during the regular legislative session, Cafero said.

The largest omnibus bill, which covered the bulk of the proposals, passed 88-53 in the House with every Republican and four Democrats opposed. A second measure, focused primarily on education initiatives and the revaluation option, passed 84-46 in a vote strictly along party lines.

Both measures passed 22-14 strictly along party lines in the Senate with the final tally wrapping shortly after 12:15 a.m. Wednesday.

“If there was a laundry hamper of a bill, this is the one,” said Sen. L. Scott Frantz, R-Greenwich, referring to an omnibus, 468-page bill with dozens of provisions. The second bill considered Tuesday contained another 190 pages.

One of the four House Democrats who cast opposing votes, Rep. Daniel Rovero of Putnam, said that while there were “a lot of good parts” to the omnibus policy bill, “it’s ridiculous to come back here, give us more than 600 pages to read in one day and expect us to give an intelligent vote.”

Democratic leaders said that the majority of measures submitted for debate had some link to the budget. House Majority Leader J. Brendan Sharkey, D-Hamden, added that most of the exceptions are “items for all of our towns and cities” that he predicted would enjoy bipartisan support.

“We truly worked on keeping our colleagues on the other side of the aisle as informed as our Democratic members were,” said Senate President Pro Tem Donald E. Williams Jr., D-Brooklyn, who added that most GOP objections were aimed at the timing of the bills, and not the content.

“The substance of the bills is good,” he said. “We are accomplishing things the people of Connecticut want us to accomplish.”

Job growth and trooper staffing taken up — not minimum wage

Several of the key items adopted Tuesday had been anticipated to be carried over from the regular session that ended May 9, including a request from Gov. Dannel P. Malloy to repeal the 1,248-trooper minimum staffing level for state police.

The statute setting that threshold has been both a fiscal and a legal thorn in Malloy’s side as he has struggled to keep the current state budget in balance.

Connecticut hasn’t met that 1,248-trooper mark in several years and had just 1,120 troopers last August when Malloy laid off 56 troopers.

Malloy, who inherited a $3.7 billion deficit when he took office in January 2011, asked the troopers and 14 other state employee unions to help close that gap with wage, benefit and other concessions worth a projected $700 million this fiscal year and $900 million in 2012-13.

The troopers rejected one portion of the concession deal — a two-year wage freeze.

A Superior Court judge sided late last year with the state police troopers’ union, who sued and argued that the statutory threshold could not be set aside. The Malloy administration appealed, but also asked the legislature to repeal the standard.

A second measure long anticipated to be placed on the special session agenda involved the latest jobs promotion initiative developed by majority Democrats in the Senate.

The measure enjoyed strong support in the House and Senate, as well as the governor’s backing. But it stalled in the House during the regular 2012 legislative session after the Senate balked at passing a minimum-wage hike sought by House Speaker Christopher G. Donovan, D-Meriden.

Highlights of the jobs plan, which was resurrected Tuesday in the larger policy bill, include:

• Expanding the existing state Small Business Express Program to provide loans and grants to an estimated 3,600 additional businesses. Currently limited to firms with 50 or fewer workers, the program would be expanded to assist businesses with as many as 100 employees.
• Launching a new program to subsidize a business’ cost of hiring unemployed veterans for the first 180 days of the job.
• Creating new “Connecticut Made” and “Connecticut Treasures” programs to promote products made here as well as the state’s cultural, education and historic attractions.
• And allowing the state Department of Economic and Community Development to give preference for loans, tax incentives and other assistance to companies that relocate jobs from overseas to Connecticut.

The proposed minimum wage increase, from $8.25 to $8.50 in January and then to $8.75 in January 2014, was left out of the bills debated Tuesday.

Roll-your-own shops face big fee hike

Donovan was tied to another controversial proposal taken up Tuesday.

The large policy bill also established a new fee on Connecticut’s so-called “roll-your-own” cigarette industry, which became embroiled two weeks ago in a scandal involving Donovan’s campaign for Congress in the 5th District.

The measure would define businesses that own or make available cigarette-rolling machines as tobacco manufacturers. More than a dozen smoke shops that make rolling machines available for patrons’ use would have to pay the same annual licensing fee, $5,250, charged to cigarette manufacturers.

The FBI arrested the finance director of Donovan’s congressional campaign two weeks ago, accusing him of accepting illegal contributions meant to push the speaker to kill the tobacco legislation.

No evidence has surfaced that Donovan was aware of the effort or did anything to stop the bill. In fact, the measure was a Senate bill that never reached the House when the regular 2012 legislative session ended in early May.

Donovan recused himself from negotiations over the scope of the special session and also was expected not to oversee the House debate from the chamber dais. But Donovan was expected to vote on the bills.

Both the Malloy administration and some legislators have said they fear that not classifying roll-your-own shops as manufacturers could threaten a crucial source of state revenue.

Connecticut has received more than $100 million annually from major tobacco manufacturers for nearly a decade and a half since it settled a lawsuit against five major firms in 1998. And some officials argue that not closing the loophole could prompt cigarette manufacturers to sue Connecticut in hopes of ending their financial obligations to the state.

Smoke shops, who argued they don’t fit the description of a cigarette manufacturer, have said the fee would be a serious blow to small businesses.

But Rep. Patricia Widlitz, D-Guilford, co-chairwoman of the legislature’s Finance, Revenue and Bonding Committee, said smoke shops have known about the state’s concerns about this tax loophole for months.

Those who operate these roll-your-own machines “choose to do so at your own risk,” she said.

“That’s a bad statement, I think, for Connecticut businesses,” responded Rep. John Piscopo, R-Thomaston, who argued the issue shouldn’t be resolved until the 2013 legislative session, when it can be studied more closely.

A similar exchange occurred in the Senate, where Westbrook Democrat Eileen Daily, the finance panel’s other co-chairwoman, said the revised definition of cigarette manufacturers was necessary “so that the playing field would be level and fair.”

But Meriden Republican Len Suzio countered that “this is probably the most thoughtless, antagonistic, heartless piece of legislation.”

Lawmakers did agree, though, to delay the imposition of the new fee until Oct. 1. The administration and the Finance, Revenue and Bonding Committee had proposed changing the system July 1.

New property revaluation option for cities and towns

Majority Democrats in the legislature also used the special session to consider a new initiative from Malloy to expand when communities can phase in revalutions of property for tax purposes.

Communities already can phase in changes in assessments over as many as five years — rather than making the entire shift in one tax year — if it involves increases in property value. The objective behind that is to ease the burden on municipal property taxpayers, particularly residential owners.

But the governor’s initiative also would give communities the option of phasing in decreases in property value, starting with this October’s grand list, which would be used to prepare tax bills to be issued in July 2013. This could assist communities whose commercial and industrial property tax bases are shrinking in value — which also could shift property tax burdens more heavily onto residential taxpayers.

“This initiative does two things: It helps local taxpayers and allows municipalities the flexibility they need to blunt the negative impact revaluation sometimes carries,” the governor said. “While we have seen improvement in our overall economy, we must continually look for ways to mitigate the impact of the recession on Connecticut residents.”

Malloy’s new proposal came a few weeks after he vetoed a bill that would have allowed Farmington, New Britain, Norwich, Stamford and Windham to delay updating property values for one year. The governor had said a measure aimed only at five communities was not fair.

The legislation enacted Tuesday also contains several remnants of the omnibus energy bill that died during the regular session.

One revived provision extends funding for energy efficiency audits for oil-heated homes, covering about half the homes in the state. Funding was due to run out this summer.

Other components of the bills adopted Tuesday would:

• Merge two quasi-public economic development agencies: Connecticut Innovations Inc. and the Connecticut Development Authority.
• Re-designate the Capital City Economic Development Authority as the Capitol Region Development Authority, expanding the types of projects it can launch, specifically charging it with promoting and attracting in-state professional and amateur sports activities.
• Re-establish the state Department of Housing with a commissioner as its head, making it the lead agencies for all housing matters. It also establishes an Interagency Council on Affordable Housing to advise and assist the commissioner.
• Change how retirement benefits are calculated for family support magistrates and compensation commissioners who began serving after July 1, 2011. It also changes how cost-of-living adjustments are calculated for these officials as well as for retired judges.
• Pushes back one of three annual report on state budget revenues from Oct. 15 to Nov. 20, effectively moving the report after the November elections.
• And require the Department of Economic and Community Development to establish a pilot program in poor communities to acquire and renovate residential neighborhoods of single- and multi-family homes.