Republicans outlined a proposal to cut spending this year by $372 million Friday, a plan they reluctantly made public in response to The Mirror’s obtaining and publishing details of ideas presented Thursday in closed-door budget talks with Democratic legislators and the administration of Gov. Dannel P. Malloy.
Their presentation was made to underline that labor savings they favor are only a portion of their approach this year — but an integral component two years down the road — and to underscore their displeasure with publication of the material.
“If this happens again, it will certainly chill the conversation,” House Minority Leader Themis Klarides, R-Derby said.
“This upsets me to no end,” Senate Minority Leader Len Fasano, R-North Haven said, adding that, “I want 100 percent trust in that room.”
The Senate leader added that if details do not remain confidential in the future, he might suggest opening the talks to the news media.
But Fasano quickly added that he wants to avoid that, since he believes confidential talks give legislators from both parties and the Malloy administration their best chance to solve the budget crisis.
Fasano said he believes Democratic legislators are responsible for details escaping the confidential budget talks.
House Speaker J. Brendan Sharkey, D-Hamden, and Senate President Pro Tem Martin M. Looney, D-New Haven, issued a joint written response to Fasano.
“Unsubstantiated accusations regarding leaks are not helpful to the negotiation process,” they wrote. “We had a productive meeting yesterday. Next week, we will present our plan at the bargaining table and in the same manner that the other parties have. We must all remain committed to finding solutions to the important issues facing Connecticut’s families.”
The GOP leaders have outlined a two-tiered proposal to address growing deficits in state finances:
- A plan to curb spending by $372.8 million this fiscal year. This would close the current shortfall — estimated anywhere from $118 million to $330 million — and provide enough resources to restore earlier cuts to hospitals and programs for the developmentally disabled and mentally ill, and to pay for some business tax cuts proposed by the governor.
- And a series of new restrictions on labor costs which — coupled with cuts in the first tier — would mitigate deficits expected to top $400 million in the 2016-17 fiscal year and approach or exceed $1.4 billion in 2017-18.
The largest proposed cut this fiscal year involves canceling a $94.6 million payment into a special revenue sharing program with cities and towns.
Those funds aren’t supposed to be distributed to communities now. Rather they are the first deposit into an account that eventually is supposed to hold enough funds to give communities almost $230 million in 2016-17 and almost $290 million in 2017-18.
The Republicans didn’t propose cutting those payments to municipalities, but GOP leaders conceded that the projected future deficits threaten those payments.
Klarides first charged last month that the legislature’s Democratic majority — which proposed the new revenue-sharing plan — is misleading voters. Democrats are campaigning now on the promise of town aid they will either cancel or cut dramatically after the election to deal with the deficit, she said.
With the governor cutting funds in September for hospitals, the mentally ill and the poor, Connecticut would be better served using that money now to help its most vulnerable, rather than maintaining the illusion of a promise to towns that won’t be kept, Klarides said. “That money was taken away from the people who need it the most,” she said.
The GOP also suggested offering incentives to encourage senior state employees to retire. This would save an estimated $80 million in salary costs, but such programs also traditionally weaken the state’s cash-starved pension fund.
Other proposed spending cuts in the Republican plan include:
•$20 million of the $24 million still earmarked for state employee raises
• $10 million through tighter controls on agency overtime accounts.
• $7.5 million to be saved with 4 percent cuts to more than 100 small line items in the budget.
• $5 million from greater efficiencies at Southbury Training School.
• $4.8 million from nursing homes.
• $4.3 million by eliminating 39 new positions across various agencies.
• $2.2 million by reducing public grants for state elections.
• $1 million from legislative franking.
• $800,000 by consolidating juvenile justice functions at the Department of Children and Families into the Judicial Branch’s Court Support Services Division.
Republicans also hope to mitigate larger deficits brewing in future years by asking state employee unions to consider a wide array of concessions.
Among the concessions the GOP is seeking include:
•Requiring all non-hazardous duty workers to contribute 4 percent of their salary toward their pensions.
• Capping cost-of-living adjustments to future retirees’ pensions.
• Calculating pensions using only base salaries. This could be very controversial. Unions fiercely resisted earlier efforts to remove overtime earnings from pension calculations.
• Developing a new, hybrid retirement plan that relies partly on a defined contribution for new workers, similar to the system recently adopted in Rhode Island.
•Suspending longevity payments for all workers after April 2016.
•Increasing state employee health and dental insurance premiums by 10 percent.
•Increasing drug co-payments for both existing employees and retirees.
• And only granting state employees cost-of-living raises next fiscal year. Most workers also normally receive an annual step increase that reflects their growing experience on the job.
The Republicans estimate these changes eventually would be worth at least $107 million per year. And that estimate doesn’t include savings from increased pension contributions and other pension-calculation restrictions. Those savings, GOP documents say, need to be calculated first by pension fund actuaries.