Wyman sneak previews state budget
By Steve Smith - Staff Writer
Regional - posted Tue., Feb. 15, 2011
Lt. Gov. Nancy Wyman said the state budget for 2012-2013 will be “not one penny more” than the budget for 2011-2012.
That was just one of the facets of the governor's proposed budget revealed by Wyman at the East of the River Chambers of Commerce Association's Legislative Outlook breakfast on Feb. 15 in East Hartford.
Ron Pugiliese, president of the East Hartford Chamber of Commerce, and the chair of ERCCA's legislative committee, said this was the first such meeting, but he thought it was important to hear directly from the lieutenant governor, as well as from former speaker Richard Balducci, to gain some perspective on what the state went through during the last period of economic turmoil.
Wyman said she and Gov. Dannel Malloy have spent most of their time in office in meetings on the state budget.
“The amount of Advil and Tums I've taken in the last few weeks has been amazing,” Wyman joked.
“We had to look at reducing expenses and restructuring government,” Wyman said. “We had to protect local services...and to preserve a safety net.”
She added that the plan will include “shared sacrifices” that everyone will have to bear.
Focusing on jobs, Wyman said, is a priority of the governor's, and he has been named to a national economic committee.
“He has already released money for two manufacturing businesses in the state,” Wyman said, “for them to stay in the state. We have made capital investments for both short- and long-term job growth.”
About $572 million is going to transportation infrastructure, which is expected to bring in 1,000 jobs, and another $130 million is going toward a clean water infrastructure project.
“One of the things that has been missing,” Wyman said, “and a lot of communities have complained about, is tourism. There will be $15 million in this next budget, so we can start advertising.”
There were a few guidelines, Wyman said, that the state is resigned to live with.
“We are not going to borrow,” she said. “We cannot afford borrowing one-time revenues to fill a hole.”
Wyman said the state will also be using generally-accepted accounting principals, which it hasn't in the past.
“It's honesty and transparency in budgeting, to me,” Wyman said. “It's no game-playing. The game-playing that's been done with budgets in this state has helped put us exactly where we are today, in a $3.5 billion deficit.”
Wyman said state agencies will be reduced from 81 to 57 – a 30-percent reduction.
“As we go forward, you will see more reductions of agencies,” she said. “We will also be seeing budget reforms that will talk about what we will do when we have a surplus again, because we will have a surplus again, and what we will do with that money. How about when we have a surplus, if we pay down some unfunded debt?”
Wyman said the plan to have the budget remain flat for the following year will not be easy to do, but will happen in part through melding pharmacy programs of medicare and the state, a reduction of the prison population, and programs that will keep older citizens at home instead of at nursing homes, which will also be restructured.
Funding to municipalities, such as the Educational Cost Sharing funds, which were funded by ARRA funds for the current year, is federal money the state won't see again.
“In our budget,” Wyman said, “we still found another $270 million to make sure we can flat-fund the ECS formula for everybody. The whole idea is that property taxes are very high, and we'll try to keep that down.”
The shared sacrifice, Wyman said, was the hardest thing to do.
“This is something we tried to do the fairest way possible,” she said. “There have been disparities.”
Wyman said there will be sales taxes applied to things that did not have them in the past. Also, about $1 billion in give-backs from state employees have been asked for, and negotiations have begun. Income tax steps are increasing from 3 to 8 steps, and brackets will range from 3 to 6.7 percent.
Other changes include allowing local governments that have hotels, etc., to put a small tax on top of the state sales tax, in order to keep property taxes down.
Former house speaker Richard Balducci , along with some history of how the state has dealt with similar economic times in the past, explained that the budget process can be very difficult for legi slators.
“History more or less repeats itself,” Balducci said, adding that the income tax was first passed in 1971 (although not implemented), and then again in 1991.
“We're now in 2011, 20 years later, and there's a problem again,” Balducci said. “We ended up changing the taxing structure in 1991, by implementing the income tax, lowering the sales tax, etc., but there's nowhere to go this time around.”
Balducci spoke about 1991, when there were a record 10 votes, many lengthy debates, and the state government temporarily went into shutdown, before finally passing the state income tax. He shared something he normally doesn't – the fact that he and fellow legislators were personally threatened in the early '90s – even though many of the people doing the threatening, he thought, were those least affected by the new taxes.
“Many people out there did not like us for what we were trying to do,” Balducci said, adding that he received threatening phone calls at all hours of the day and night, including a particularly disturbing call that his then 10-year-old daughter answered.
“Many of those people were screaming and yelling at us, but they didn't know what it meant,” he said. “I got those calls all day and night. Some of the folks got their cars shot at. You want to do something like that, vote me out of office. That's the way to handle that.”
“It was a difficult time,” said Wyman, who was a representative at that time, “but it really was the right thing to do.”