Gov. M. Jodi Rell’s Budget Secretary Robert Genuario said during his budget briefing with the media this morning that the governor has no plans to spend the more than $200 million surplus, both Democrats and Republicans were clamoring to give back to taxpayers last week.

Instead, Rell is proposing putting the surplus into the rainy day fund. “We do think it is a time for caution,” Genuario said.

Rell is proposing a 4.8 percent increase in spending over fiscal year 2008. The total policy changes in the governor’s budget are projected to require $47.4 million in additional funding.

Some of those policy expansions include hiring 125 additional correctional officers to deal with the increase in the prison population, which was expected to decrease slightly now that Rell lifted her ban on parole for violent offenders. It also expends funds for prison re-entry programs and a number of other recommendations made during the January special session on criminal justice reforms.

She also has plans to split the Department of Transportation into two departments: one for highways and one for public transportation, aviation and ports. This was not a recommendation of her Department of Transportation task force appointed to look at restructing the beleaguered agency.

Rell will reintroduce her municipal property tax cap, which Genuario said was more flexible than last year’s proposal. It lets municipalities opt out of the cap for two-year periods, if two-thirds of local elected officials agree to the waiver by Sept. 30, 2008. And it will be phased in over three years starting with a 4 percent cap in the first year and a 3 percent cap in the third year.

The local property tax cap, which was not a big hit with Democratic lawmakers last year, will likely sink again.