Malloy defends investment record at penultimate Bond Commission meeting
Gov. Dannel P. Malloy, keenly aware of the unwelcome role his record is playing in the campaign to succeed him, spent one of his final State Bond Commission meetings Thursday defending state borrowing made during his tenure to promote economic development statewide and help Connecticut’s struggling capital city.
On a day when a new jobs report showed unemployment dropping to 4.3 percent after four consecutive months of jobs growth, Malloy sparred with Republicans over more than $220 million in borrowing approved by the commission in its last meeting before Election Day, at times sounding a valedictory note about an administration that exits on Jan. 9.
“It’s about housing. It’s about transportation. It’s about education, and many other strengths that make Connecticut a great place,” Malloy said. “And rebuilding our cities has been at the core of our efforts to achieve longterm improvement of the state’s economy and quality of life. We have made the critical investments in those areas since Day One, and we did it once again today.”
Hartford, which teetered on the brink of fiscal insolvency until a state bailout this spring assumed a massive portion of city debt, was a major beneficiary of the commission’s actions at its last meeting before Malloy, a Democrat who previously served as mayor of Stamford, officially becomes a lame duck.
Malloy, who says he expects at least one more commission meeting before he leaves office, was asked by reporters after the meeting if he is anxious to press forward on an agenda that may not be embraced by his successor.
“I suppose I wonder what somebody else is going to do, but I want to remind everybody there’s only one governor at a time,” Malloy said. “I’m governor until the end of my term, and I will work just as hard every day…to the end of the term, as I have previously.”
The panel approved nearly $53 million in financing for several projects overseen by the quasi-public Capital Region Development Authority, which has leveraged private investment in Hartford with low-cost financing and grants. The projects funded Thursday include:
- A development featuring 108 units of housing and commercial space at the corner of Park and Main streets on the southern edge of downtown.
- Loans to support the Downtown North redevelopment project near the Dunkin Donuts Park, the home of a minor-league baseball team, and refurbishment of historic retail buildings along nearby Albany Avenue.
- Development of a grocery store on Albany Avenue, the main thoroughfare though a minority community with limited access to fresh foods.
- Expansion of the Charter Oak Health Center.
- Construction of a state parking garage on Clinton Street near the State Office Building, which is now being refurbished. It will provide parking for state employees and the public, including nighttime patrons of the nearby Bushnell Performing Arts Center.
- Improvements to Great River Park in East Hartford on the Connecticut River.
Republicans in the House and Senate objected to the Hartford bailout deal, arguing the level of debt aid Malloy approved grossly exceeded the amount legislators had approved. The governor countered that GOP lawmakers misunderstood the bailout statute many of them approved.
But given the twin realities of that extensive debt assistance and the state’s ongoing fiscal woes, Rep. Chris Davis of Ellington, one of the Republicans on the commission, asked Malloy why Connecticut now should finance more local projects in the capital city — particularly around a baseball park development that Malloy and legislators agreed shouldn’t receive state aid.
“So, in addition to taking on all of their debt, we said we would pay for all of the other projects they normally do?” Davis asked.
Malloy, who chairs the bond commission and sets its agenda, responded that “we participate in those things on a regular basis” in many communities, including some wealthy ones.
The commission unanimously approved $650,000 in financing to assist with affordable housing development in Fairfield, an affluent community on the southwestern shoreline. A playground in Farmington also was approved.
But Thursday’s bond commission agenda also was peppered with far more items for cities and smaller urban centers, all of which were approved.
These included improvements to a public handball court in Manchester, Little League fields and a “splashpad” playground in New Haven, dredging of the channel leading into Cove Island Park in Stamford, lighting for Wolcott Park in West Hartford, and a playscape for a West Haven elementary school.
“It is a proper role of government,” said Sen. John Fonfara, D-Hartford, who also serves on the commission. Fonfara defended the spending on Hartford, noting that Connecticut businesses complain frequently about the state’s struggling cities and the lack of available workers in urban centers. “I think some perspective is necessary.”
Thad Gray, the Republican candidate for treasurer, said Malloy was engaging in pork-barrel spending on his way out the door. “It would be comical if the consequences weren’t so serious for the economic health of our state,” he said.
Davis would be on the losing end of eight commission votes on packages of proposed financing. In two instances, he was joined in dissent by the only other Republican on the 10-member bond commission, Sen. L. Scott Frantz of Greenwich.
Davis sparred with Malloy on matters other than financing for Hartford. More than $50 million in financing for Connecticut Innovations Inc. and its affiliate, CTNext, and another $53 million for Department of Economic and Community Development-endorsed business investments also proved a sore point for the Ellington Republican.
These projects dredged up the memory of Malloy’s first big economic investment, $291 million — borrowed at an interest cost of $150 million — to help finance a 173,000-square-foot genomic medicine research center near the University of Connecticut Health Center campus in Farmington.
A huge chunk of that investment — $192 million — was a loan that would be forgiven provided it created at least 300 new jobs within a decade and retained them for two years. Jackson Laboratory met that requirement early, but Davis noted the company followed up its good fiscal fortune by expanding its Maine-based operation, which breeds mice for scientific research, and not its Connecticut site.
“We’ve bonded over $1.7 billion … for economic development under the Malloy administration with little to no economic growth whatsoever. At some point, eight years in we should be questioning whether this is the way to do economic development,” Davis said.
Malloy was ready with statistics about the state’s economic growth, helped by a favorable monthly jobs report released earlier by the Department of Labor. It showed Connecticut with a fourth consecutive month of jobs growth in August, dropping the unemployment rate by a tenth of a point to 4.3 percent. The U.S. rate is 3.9 percent.
Connecticut now has recovered 113 percent of the private-sector jobs lost in the Great Recession of 2008, but the government sector has lagged, leaving the state with 88.5 percent of the jobs it had prior to the recession. The government sector, which includes two tribal casinos facing increased competition, continued to shed jobs in August.
Malloy said he sees nothing wrong with a smaller state government.
“I wanted smaller government. I ran on smaller government,” Malloy said. “When I was mayor of Stamford, I shrunk city government by 10 percent. That’s what I did.”
Malloy said the private-sector numbers, which are much improved but still lagging much of the nation, are the better metric of the state’s economy.
“What’s most encouraging is that we now have created more than 23,000 private sector jobs over the last 12 months,” Malloy said. “That’s the biggest one-year gain since early 2011, when we were just beginning to recover from the Great Recession. This is not just a blip. It’s a long-term, positive trend, and it should be highly encouraging for Connecticut residents and businesses.”
He said the state’s investments in economic-development are part of that growth, as is his support of Hartford. He singled out two Hartford neighborhoods on the northern and southern edges of downtown, the recipients of state bonding approved Thursday that will leverage $100 million in private investments and produce jobs.
“Eight years ago, it would have been unimaginable to see private investments on this scale at these locations,” Malloy said. “It has been made possible by this administration’s steadfast and collaborative efforts to transform Hartford through development of thousands of housing units, bringing UConn to downtown, doubling down on the state’s presence in downtown with new office space, and many other projects.”
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