Legislature’s New Year resolution: Close the deficit
With a special session that opened Friday and will continue into the New Year, the Connecticut General Assembly is resuming work on a bipartisan budget adopted just before Halloween, deemed in deficit by Thanksgiving and in need of significant repair by Christmas.
Legislative leaders said they first will restore a $54 million cut in a Medicare assistance program that provoked a public outcry, then open bipartisan talks about how to tackle the broader problem of closing a projected deficit, one pegged at $222.5 million.
“We are going to start meeting as soon as next week to talk about deficit mitigation,” said House Speaker Joe Aresimowicz, D-Berlin.
It had been unclear if the legislature would act on the deficit. Gov. Dannel P. Malloy, who was shut out of the talks that led to the bipartisan budget, had been criticizing the lawmakers over what he saw as a refusal to confront the larger issue of the deficit while restoring a Medicare spending cut found to be politically unpopular.
Senate President Pro Tem Martin M. Looney, D-New Haven, said action on the deficit was unlikely before the release of the latest revenue estimates in mid-January.
The outcry over the cuts to the Medicare Savings Program, which can help people with Medicare premiums and co-pays, is a stark reminder of the difficulty in making further cuts to a $20 billion budget. The cut was based on an effort to tighten eligibility requirements that were loosened in 2010.
House Majority Leader Matt Ritter, D-Hartford, said worsening deficit projections would leave legislators with little choice but to consider new revenue sources or deeper cuts to major programs like municipal aid that previously were deemed off limits.
“This stopped being easy eight years ago,” said House Minority Leader Themis Klarides, R-Derby.
With the nation falling into a recession, legislators struggled in 2009 to negotiate a budget with then-Gov. M. Jodi Rell, a Republican who ultimately allowed a spending plan to become law without her signature. It was the start of fiscal woes in Connecticut that have waxed and waned, but never disappeared.
Rell left a stunning first-year deficit of nearly $3.7 billion for Gov. Dannel P. Malloy, a Democrat who took office in January 2011. Current projections indicate that Malloy, who is not seeking a third term in 2018, will leave a major shortfall for his successor as well.
The bipartisan deficit talks will take place in the weeks before the legislature is to convene its session for 2018, an election year in which lawmakers will do all they can to produce a new budget without drama and on time. The current budget was delivered nearly four months into the fiscal year.
The 2018 session will open Feb. 7 with Malloy proposing his budget for the fiscal year that begins July 1. Given the state’s system of biennial budgeting, the governor technically will be proposing revisions to the second year of the two-year spending plan adopted in 2017.
Two weeks ago, the governor proposed options for closing the deficit that included raising the sales tax rate as high as 6.9 percent, boosting other taxes, cutting municipal aid by $50 million and reducing health care, social services, and other programs. Collectively, the ideas forwarded by Malloy could boost revenue and reduce spending by more than $302 million this fiscal year — more than enough to counter the deficit projected for the current fiscal year.
The legislature took no action Friday, other than opening the most recent special session by a part-time legislature whose regular annual sessions end in May in even-numbered years and June in odd years.
This special session is a rarity: One that is open as one year ends and another begins.
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