Gov. Ned Lamont. Frankie Graziano / Connecticut Public Radio
Gov. Ned Lamont (file photo) Mark Pazniokas / CT Mirror

Gov. Ned Lamont kept his promise Tuesday to keep a tight grip on Connecticut’s credit card absent a deal from legislators on a long-term transportation plan.

The administration, which canceled State Bond Commission meetings in June, July and August, released an agenda for the September meeting that recommends nearly $400 million in new financing.

And while that might seem like a lot of money at first glance, nearly all the funding is dedicated for school and road construction, state facility maintenance, job development and clean water projects. What’s missing are the tens of millions of dollars often included on commission agendas under the previous administration for smaller, community-based projects in legislators’ home districts.

The only major initiative not among the traditional bonding areas involves $25 million to assist homeowners with crumbling foundations. This effort has enjoyed overwhelming bipartisan support and is aimed at more than 30,000 homeowners spread across the eastern half of the state.

“We’re going to have a skinny bond agenda,” said Lamont, who answered questions Tuesday morning following a tour of the Hospital for Special Care in New Britain.

The governor has been at odds for much of this year with his fellow Democrats in the House and Senate over whether to curtail state borrowing. Connecticut has more than $25 billion in bonded debt and ranks among the nation’s most indebted states on a per capita basis.

The governor initially recommended that lawmakers authorize no more than $1 billion per year in general obligation, or G.O., bonding, two-thirds of what it issued on average between 2012 and 2019. G.O. bonds are repaid with income tax receipts and other revenues from the budget’s general fund and are used to fund more capital projects not involving transportation.

Lamont also wants to ramp up state investments in transportation, but favors electronic tolling, which would provide hundreds of millions of dollars in receipts that Connecticut could use to pay cash for projects instead of more borrowing.

Lawmakers, to date, have declined to adopt tolls. And since Lamont says Connecticut’s aging, overcrowded highways and rail lines must be repaired, will the state try to put more borrowing on an already maxed-out credit card?

Until that question is answered, the administration said in July, bonding for non-essential projects must wait.

“Are we going to put $700 million more [in annual bonding] on the taxpayers backs” to fund transportation? Lamont asked, adding he still believes tolls and debt avoidance is the wiser strategy. “First we’re got to deal with the gorilla in the room.”

The package includes three items with strong ties to specific communities, none of which involve recreational or entertainment purposes.

There’s $4 million for water and sewer main work near East Main Street in Waterbury to complement a local economic development effort.

Another $2 million would be borrowed to demolish the vacant Crystal Avenue apartments in New London to allow for industrial development near State Pier.

And $3 million to renovate and make improvements to the Batchelder School in Hartford to enable it to serve as the home for a regional magnet school.

Trying to reach compromise, Lamont offered earlier this summer to consider as much as as $1.3 billion per year in G.O. bonding — provided legislators would agree to dedicate $100 million of that extra $300 million for state transportation projects.

Democratic legislative leaders have countered that they need $1.3 billion per year in G.O. bonds to meet all of their non-transportation needs. If Lamont wants an extra $100 million for transportation infrastructure, they said, then the G.O. bonding total needs to climb to $1.4 billion.

Legislators say not all of the projects for which they seek state bonding involve recreational or leisure programs. Many of the community-based projects, they say, would support private, nonprofit social service groups that work with the disabled and the mentally ill. These bond dollars fund capital repairs the nonprofits otherwise could not afford.

A new, two-year bonding plan was supposed to be in place when the fiscal year began back on July 1, and cities and towns already have been hurt by that delay.

While most state aid to municipalities was included in the new, two-year, $43.4 billion state budget enacted in June, Connecticut issues bonds and borrows the funds it distributes in three grants — one of which is the $60 million Town Aid Road [TAR] program.

And half of that grant, or $30 million, was due to communities back in July. Most cities and towns rely on that installment to cover summer road repaving work.

Keith has spent most of his 31 years as a reporter specializing in state government finances, analyzing such topics as income tax equity, waste in government and the complex funding systems behind Connecticut’s transportation and social services networks. He has been the state finances reporter at CT Mirror since it launched in 2010. Prior to joining CT Mirror Keith was State Capitol bureau chief for The Journal Inquirer of Manchester, a reporter for the Day of New London, and a former contributing writer to The New York Times. Keith is a graduate of and a former journalism instructor at the University of Connecticut.

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5 Comments

  1. I applaud not borrowing even more. However, when are we going to REDUCE the total amount of money we intend to spend? Having a $43.4 BILLION BUDGET is ridiculous for a state with our small population and geography. We keep hearing about “budget prioritization” but shouldn’t politicians share the algorithm being used to do that prioritization? Is there an algorithm?

    The CBIA just released their annual business survey. Business confidence in the state legislature fell to an all-time low, with 92% of respondents either somewhat or strongly disapproving of lawmakers’ handling of jobs and/or of the economy. 81% of those businesses feel that our state economy is in decline, up 20% from last year! Those that are making a profit are NOT investing those dollars back into Connecticut. In essence, we are now educating other state’s workforce.

    1. It is a ridiculous amount of money and I heartily agree that there has been no talk of spending cuts, which any private business would have done years ago, but note that the $43 billion is a two year budget, not one year.

      It’s still too much and hidden have been the billions in bonded debt that are used for operational expenses.

      Don’t forget that state employees cannot be laid off under the current SEBAC agreement.

      1. I thought they could be laid off now. Still, the bigger issue is the old pension and retiree health care promises. At least the current employees are doing something for the state and actually living here. I wonder how many doctors in Florida our retiree health care is supporting.

      2. 2021 before they can (but won’t) be laid off. And mandated 3.5% raises the next two years. Doesn’t matter if you are good or bad at your job, you get a raise. What private company does that?

        And yes, they pay taxes but it’s with our money.

        Probably 1/4-1/3 too many state employees.

  2. This is consistent.
    The Governor believes that there are no significant transportation issues for the next 5 years. Then a major new revenue stream from tolls can replace any current general fund expenditures on transportation, assuming that the toll money would reach the transportation fund.
    Even the relatively small amounts sent to towns for repairs are unneeded. That money is so unimportant that it’s bonded instead of being a general fund expenditure.
    I don’t think the legislature will respond to even more blatant pressure. The non-profits will have to focus on obtaining money from the state to cover the minimum wage increase rather than improvements to their existing buildings.

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