Hartford - A confident Gov. Dannel P. Malloy struck broad themes Wednesday in his second State of the State address, laying out his vision for a "full-scale economic revival" and a further break from the path to mediocrity, which he says Connecticut traveled before he came to office.

"Yes, it has been a long 13 months," Malloy told the crowd of lawmakers packed into the Capitol's House chamber for the opening day of this year's session. "But a state that was on its knees has stood up and said, 'Enough is enough - we're ready to change our future.'"

Malloy described how, years ago, Connecticut led the nation in innovation, education and producing things. But after a while, the state stopped leading and took to muddling along, he said, finally reaching its ignominious distinction of no sustained job growth in 22 years.

By his swearing-in in January 2011, Connecticut was "staring into the abyss." State government was bloated, faced a staggering $3.5 billion budget deficit, and was also bound to unsustainable labor and pension agreements.

But now the state is back on track, Malloy said, thanks to the tough decisions and systemic changes made in his first year in office: a budget that doesn't borrow to cover operating expenses; a savings and concessions agreement with state unions; and a commitment to convert to a more transparent accounting system.

Malloy said there are 2,700 fewer state employees and 22 fewer state agencies than a year ago. In the biggest applause line of his speech, the governor announced that 9,400 new private-sectors jobs were created in Connecticut last year.

"That stability gave the private sector the predictability it needed to make investments and create jobs," Malloy said.

The governor spelled out three keys to future prosperity: sustained fiscal discipline, a reformed public school system and surety that "the entire world knows that Connecticut is open for business."

New spending

The bread and butter of the governor's address was a proposed $329 million in additional spending during the second year of his biennial budget. This 1.6 percent increase would grow the state budget to $20.7 billion for the fiscal year starting July 1.

Most of the new spending - $128 million - would finance Malloy's much-anticipated package of education reforms, which he said are critical to the state's economic future.

Much of the rest of the new funding would go to a long-term plan for adjusting the state employees' pension system contribution schedule, as well as for what the administration is calling new safety-net initiatives.

Other new expenses include $260,677 for expanding Shore Line East weekend service to provide five round trips between Old Saybrook and New London, and one round trip between New Haven and Old Saybrook starting April 1, 2013.

To afford the new spending, the governor plans about $120 million in cuts affecting areas such as culture and tourism grants, worker overtime reductions and raising the eligibility requirements for a Medicaid program to serve low-income adults.

And repealing the prohibition on Sunday alcohol sales, if approved by the legislature, would generate nearly $9 million in new revenue.

Yet most crucially, Malloy's midterm budget adjustments require stronger tax receipts from a growing state economy. His budget chief projects 5.7 percent revenue growth in the next fiscal year, a significant increase from the 1.7 percent increase for the current year.

OpSail, education

Republicans expressed concern that the administration's revenue projections are too rosy. House Minority Leader Lawrence Cafero, R-Norwalk, pointed out that by some estimates the state budget already is running a deficit of more than $100 million.

"I don't agree with his assessment of where we are fiscally in this state," Cafero said. "I don't agree with it, but I hope it's right."

Asked whether Malloy's budget will set aside money to bring OpSail 2012 to New London, Ben Barnes, secretary of the Office of Policy and Management, replied that the state is providing money but that local OpSail organizers need to "raise some money on their own." He did not say how much money the state would contribute.

The governor's education reform package includes a $50 million increase in Education Cost Sharing funding for school districts, the first boost since 2009.

Most of new money would be directed to the 30 lowest-performing school districts in the state - 130 cities and towns would receive new money, including New London ($809,001) and Groton ($250,190). No municipality would receive less funding.

Malloy's other education initiatives include a funding boost for charter and alternative schools, a new program for turning around low-performing schools and higher standards for teachers.

On the policy end, Malloy called for an overhaul to the teacher tenure system in public schools, which allows teachers to gain tenure after having worked four years in the same district. Contracts for tenured teachers are automatically renewed each year, and tenured teachers can be fired only for six specific reasons.

The governor vowed to tackle tenure, regardless of how politically sticky the issue can be. "Tenure is too easy to get and too hard to take away," he said. "Under my proposal, tenure will have to be earned and re-earned, not earned simply by showing up for work."

The governor said he won't do away with tenure but will seek "objective performance standards, including student performance, school performance and parent and teacher peer reviews." Tenured teachers would need to prove their effectiveness at different stages of their careers and receive professional development help if they need it.

After the speech, the president of the state's largest teachers unions did not take a stance on Malloy's tenure plans. That proposal, like other elements of his education package and budget adjustments, needs legislative approval.

"We're sharing the governor's proposals with our members to get their expertise, opinions and suggestions from their viewpoint as classroom teachers," said Phil Apruzzese, president of the Connecticut Education Association.

But Jerry Labriola, chairman of the Connecticut Republican Party, had grim predictions for the governor's tenure idea. "I'll be very surprised if he could overcome the powerful elements of the teacher union lobby," he said.

'Courageous and bold'

The governor's address was well-received by members of southeastern Connecticut's legislative delegation.

"He does have a broad vision, and what we need in Connecticut is strong leadership and courageous and bold proposals," state Rep. Elissa Wright, D-Groton, said in the buzzing Capitol corridor after the speech.

State Sen. Andrea Stillman, D-Waterford, a co-chairman of the Education Committee, said she supports most of the governor's proposals and believes her colleagues will consider his ideas for teacher tenure.

Stillman conceded that $128 million is not "a whole lot" of additional money for large-scale reforms but said it's enough for a meaningful start.

"I think that the governor has made proposals that are very appropriate and long overdue," Stillman said. "We can't have job growth without education reform."

j.reindl@theday.com