In my experiences, whether I am speaking with friends and coworkers in Danbury or walking the halls of the State Capitol in Hartford, one clear fact emerges: it is an anxious time for Connecticut.
The state’s historic budget crisis is no longer just chatter among Hartford insiders, but is now a topic for tense discussions at conference rooms, town halls, and kitchen tables across Connecticut. Families and businesses are agonizing over suggestions that swirl around the state for more tax hikes, severe budget cuts, and threats to their livelihoods from every direction.
That is because for the first time in recent memory there is a consensus between the governor and both parties in the legislature that the fiscal crisis (1) exists, (2) was precipitated by an excess of unfunded liabilities, and (3) cannot be solved by even more taxes. While this understanding is an important step for us, agreement between each faction largely diverges along the lines of where savings in the budget should come.
This savings part is where people start to get worried.
In his proposed budget for 2017-2018, the governor has maintained his position of seeking to balance the budget by shedding state costs and passing them on to other public institutions, so the cost is borne locally.
As one of these cost-saving measures, Governor Malloy’s budget proposal targets hospitals as a prime source of new revenue for cash-strapped municipalities by allowing cities and towns to levy property taxes on the historically tax-exempt institutions. These new taxes would amount to an enormous cost to hospitals that already struggle to persist in this state. In fact, the governor has a disturbing history of making hospitals cover shortfalls in the state budget, with Connecticut hospitals still reeling from paying $556 million in state taxes every year because of new taxes levied in 2012.
Even in these challenging economic times, it is an unfortunate act of financial desperation for a state to break centuries of tradition and tax hospitals. Hospitals serve as economic engines of their communities, providing enormous benefits that drive growth in the health and medical field, as well as all of the ways they work to make their communities healthier. In many cities, their local hospital may be its biggest employer, such as how Danbury Hospital is for the Greater Danbury-area.
The reason these spending cuts are totally unacceptable is because hospitals and education need to be prioritized as essential government services that taxpayers willingly chip in for. They cannot be subject to cuts under any circumstances – even in times of fiscal crisis – because of the undue stress it puts on taxpayers and the devastating cuts to core services that residents would have to endure.
Instead of looking to cut highly-valued local services, state government must look within itself for savings.
When the budget is analyzed, our state’s bureaucracy is where the most savings can come from that will hurt far less than cutting funding to hospitals and school districts. In Connecticut, public sector employees receive luxurious fringe benefits that are unparalleled in both the private sector and in the packages offered by other states.
I do not bring this up to say that state employees deserve blame for our fiscal crisis, because they do not. Instead, the bottom line is that we can achieve significant structural reforms this year by making public sector jobs look more similar to private sector jobs. I have advocated for numerous sweeping changes that would amount to hundreds of millions of dollars in state savings on its labor. These include: increasing co-pays for healthcare, increasing retirement contributions, eliminating positions as they become vacant, a pure defined contribution plan for all new hires, privatization to achieve greater efficiencies and savings, and eliminating overtime pay from state pension calculations. In all, we can save about $1 billion every year if these state positions were aligned more closely to the private sector.
The result of these reforms and union concessions would be a new state budget that advocates for taxpayers rather than bureaucracy. With confidence in Connecticut drastically crumbling, I think it’s about time for a radical, new approach that doesn’t threaten services we rely on. That is a Connecticut we can be proud of.
State Representative Michael Ferguson represents the 138th district communities of Danbury, New Fairfield, and Ridgefield.