On Tuesday, State Senators Kevin Witkos (R-8) and Craig Miner (R-30), and State Representatives Bill Simanski (R-62), Jay Case (R-63), and Brian Ohler (R-64) joined together with their caucuses to release a revised two-year state budget proposal with no new taxes that would put a stop to the governor’s executive order, restore funding for education and core social services, and provide stability for towns and cities.
The revised budget proposal offered by Senate and House Republicans includes no tax increases and rejects the governor’s proposal to shift teacher pension costs onto towns and cities that would further burden municipalities and lead to increased property taxes. The Republican budget proposal combines elements of the Senate and House Republicans’ multiple prior budget proposals released earlier this year, feedback from Democrat lawmakers and the governor, and factors in the legislature’s passage of the state employee labor concessions deal that is now law.
“We have to pass a state budget. And it must be a budget that protects education, provides stability for residents, and does not increase taxes. That’s what Republican lawmakers have proposed in all our budgets and what we continue to offer in this revised version,” said Sen. Witkos. “It’s clear that the two largest tax increases in state history failed to pull Connecticut out of its financial crisis and have only worsened the chaos we face today. If we want to restore people’s confidence in our state, we need to stop relying on tax increases and we need to embrace the structural reforms we so desperately need to move Connecticut in a new direction towards economic growth and opportunity for all. We offer this budget as a path towards a brighter future and hope to garner bipartisan support from lawmakers and vote on this budget as soon as possible.”
“Senate and House Republicans have said for many months that our state needs a budget that makes changes to the way we govern and spend taxpayers’ money. This budget proposal does that, while prioritizing spending for education, municipalities, and core social services without raising taxes,” Sen. Miner said. “I believe this is the kind of budget that will bring financial stability to our state and put Connecticut on track to build a strong economy.”
“House and Senate Republican Caucuses have been working hard to solve our state’s budget crisis. Today’s budget announcement is the latest in a series of fully vetted, balanced and responsible no-tax increase proposals. Our budget avoids draconian cuts to municipal aid, reductions to school funding and avoids shifting the costs of the teacher’s retirement system on to towns. Additionally we propose important structural changes to how the state operates and spends money,” said Rep. Simanski. “Our goal is to enact a balanced budget that avoids the yearly deficits that have hurt Connecticut. This responsible approach would be the first step to getting our state on the right path. ”
“It is time for legislative action on a state budget. The citizenry of Connecticut should not fall victim to the failed policies of the legislative majority. I, along with my Republican colleagues, have been ready to vote on a no-tax-increase budget option since June. We are now three months into the fiscal year and the Majority Party has yet to put forth a plan that does not levy taxes from our residents and our municipalities. The plan put forth today, however, maintains the core functions of government by ensuring funding for our seniors, education, and social services is available. I urge my colleagues on the other side of the aisle to consider this proposal when we get the chance to vote on a budget,” stated Rep. Case.
“Today, we are releasing, for a ninth time, a revised no-tax budget for FY ’17-19. I, along with my fellow House Republican colleagues, are proud to stand in solidarity with our Senate Republican counterparts. As each day and month goes by, our state’s fiscal clock continue to tick. We have backed up every argument with a sound and responsible solution. It’s no secret that our revenues have yet to slow the hurtful fiscal policies of the legislative majority. We’ve proven, time and time again, by providing competent, vetted budgets, that we have the best plan to move our state forward. Come Thursday, if the Speaker of the House and majority party fail to call their own budget, then they have a moral and ethical responsibility to call this proposal,” said Rep. Ohler.
The Republican proposal includes the following:
No New Taxes
The revised Republican budget contains no new taxes. It does not increase or expand the sales tax, hospital tax or income tax. It also rejects the governor’s proposal to shift teacher pension costs onto municipalities as such a policy change would likely result in property tax increases.
The Republican budget enacts two policies that will reduce taxes for retirees by phasing in a tax exemption for Social Security and pension income for middle income families. In addition, the Republican budget also restores the entire $200 property tax credit for all qualifying families and individuals. Under Governor Malloy’s tenure this tax credit has been reduced from $500 and we believe that property owners deserve a break on their taxes.
Increases Education Funding
The Republican budget rejects the governor’s devastating education cuts contained in his budget proposal and executive order entirely. It instead includes a fully revised Education Cost Sharing Formula that takes into account factors regarding recent court decisions, enrollment, poverty, wealth and number of English Language Learners, among other factors. This budget dedicates $33.6 million more to education in FY 2018 and $136.6 million more in FY 2019 and phases in a new formula over 10 years. It also establishes a council to analyze and make any necessary changes to the new formula within the next year if deemed necessary. In 2018 all towns and cities’ base ECS grants will either be held harmless or gain more funding.
Municipal Support and Mandate Relief
This budget provides predictable municipal aid so that towns and cities know what they can count on from the state. This plan does not ask towns and cities to pay for teacher retirement costs as the governor’s proposal does. It also implements significant mandate relief for cities and towns to help municipalities achieve efficiencies and pass savings on to taxpayers.
Funds Core Social Services
This revised budget maintains Republican proposals to restore funding for core social services and programs that benefit people most in need. It fully funds day and employment services for individuals with intellectual and developmental disabilities, reopens Care4Kids, protects funding for SAGA that supports disabled residents who are unable to work, funds school based health clinics and family resource centers, restores funding for mental health services among many other programs.
The Republican budget recognizes the importance of a safe, modern transportation system to public safety and economic growth throughout our state. Therefore, this budget prioritizes the state’s transportation needs and stabilizes funding without tolls or new taxes. It implements the Republican “Prioritize Progress” transportation funding plan and stabilizes the state’s Special Transportation Plan by dedicating transportation-related revenues to fund transportation needs and protects monies in the state’s Special Transportation Fund from being diverted for other uses.
The Republican budget lowers taxes for retirees by immediately eliminating the tax on social security and phasing in an elimination of taxation of pension income for single filers with an AGI below $75,000 and joint filers below $100,000. It also helps seniors age in place by restoring funding for core programs such as Meals on Wheels, the personal needs allowance, non ADA dial a ride, and the CT Home Care Program.
Employment and Day Opportunities for the Intellectually Disabled
Our budget fully funds employment and day opportunities for new high school graduates over the biennium, nor does the Republican Budget carry forward reductions imposed by Governor Malloy to employment and day opportunities services for the intellectually disabled.
Funds State Parks & Tourism
Acknowledging the multiplier effect that tourism has on our economy, the Republican budget proposes to transfer 1.5% of the current hotel occupancy tax to a new Marketing, Culture and Tourism account. This is not a new tax as Democrats have proposed. Rather, it dedicates a portion of the current tax for its intended purpose to boost tourism funding. This budget also implements the Passports to Parks program that has garnered bipartisan support in the legislature.
Reduces Size of Government
The Republican budget proposal includes overtime savings of 10 percent, a hiring freeze on non-24-hour non-union positions, and makes cuts to the legislature such as reducing the number of legislative committees. The budget also makes targeted spending cuts, 10 percent reductions to certain agency accounts, and rolls forward lapses made last year except for cuts to core services such as grants for mental health and substance abuse and youth service bureau funding.
Includes Structural Changes
In addition to balancing the budget over the next two years, this budget includes policy changes that roll out into future years to achieve significant savings. Changes include items such as a spending cap, bonding cap, municipal mandate relief, and other policy changes for long term savings. The budget also implements pension reform beginning after the SEBAC deal ends in 2027 that will result in some immediate savings as calculated in an actuarial analysis.