Set Connecticut free, pass a state budget

Month three of Connecticut held hostage, or at least stuck without an approved state budget.

This was supposed to have been finished well before the start of fiscal year, July 1. Yes, it’s hard. But so, too, is keeping a household budget in balance, paying the mortgage, the property taxes, the bills, while making sure the kids have what they need for going back to school.

People figure this out. The Connecticut General Assembly has to do so, as well.

Consider all the towns and cities in the state that had to produce their budgets for the fiscal year without any affirmative information on what level of state aid they would receive. For many municipalities the speculation for cuts in state aid has ranged from not so bad, to dire, to catastrophic (i.e. the governor’s budget proposal).

The General Assembly, however, remains politically paralyzed, unable to find consensus on closing a projected $3.5 billion gap over the next two years.

Gov. Dannel P. Malloy argues that after income tax hikes that raised the top marginal rates to help close deficits in 2009, 2011 and 2015 — a period over which state aid to local communities grew by 21 percent — it is time for municipalities to sacrifice via reduced state aid. Malloy also wants to force them to help fund teacher pensions, now only a state responsibility.

Malloy’s budget proposal recommended cutting grants to cities and towns by about $650 million over two years. In addition, he wants the municipalities to collectively start contributing $400 million annually to help support the now grossly underfunded teacher retirement plan.

To help offset these hits, the governor urged the legislature to let communities impose taxes on the property of nonprofit hospitals.

Municipal officials say that Malloy’s plan will mean higher property taxes. The legislature has had little interest in any of it.

Progressives in the Democratic caucus, particularly on the House side, are ready instead to turn to an increase in the sales tax, perhaps the income tax — again — and a host of other taxes to balance the budget without taking an ax to municipal aid or undermining social services. House Speaker Joe Aresimowicz, D-Berlin, is in that camp.

But moderate Democrats, particularly in the Senate, don’t want to be saddled with a budget with yet more tax increases as they head into the 2018 election year. What exactly those moderate Democrats do want, however, is less clear.

Meanwhile the leadership of the sizeable Republican minority, which could play a part in putting together the votes to approve a budget, only want to keep reminding everyone that they had a different idea for labor savings — and so opposed the $1.6 billion concession package Malloy reached with the unions — and don’t want to raise taxes, period.

If Republicans sit this out — and, as noted before, they have plenty of political incentive to let Democrats own this mess — then the Democrats have to find the votes, and that has proved very tough.

Our preference would be to see a coalition of moderate Democrats and Republicans approve a budget with only small tax increases and with reforms that more fairly distribute state aid for education. We see some significant cuts in state aid as unavoidable, but which should be accompanied with reductions in state mandates, revisions that strengthen the hand of municipal officials in negotiating with the labor unions, and with incentives to boost regional initiatives.

But that doesn’t appear to be in the political cards.

The Senate is split 18-18 between Democrats and Republicans, their “majority” dependent on the tie-breaking vote of the lieutenant governor. In the House the Democratic majority is only 79-72. To get a budget passed, Democrats cannot lose any votes in the Senate, few in the House. How they accomplish that, given the deep philosophical divisions over how to address this crisis, is difficult to say.

But as the fiscal year continues, the cuts Malloy must impose to keep the state’s books in balance will grow more severe, and the wailing and lamentations from those victimized by the cuts louder.

Maybe then the legislature will figure out a way to free the hostage.

The editorial board is composed of the publisher and four journalists of varied editing and reporting backgrounds. The board's discussions and information gained from its meetings with political, civic, and business leaders drive the institutional voice of The Day, as expressed in its editorials. The editorial department operates separately from the newsroom.

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