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(Updated 4:12 p.m.) When Republican Gov. M. Jodi Rell sent this letter to the legislature’s Higher Education Committee Monday saying she did not support the University of Connecticut’s plan for a new $475 million hospital and partnership with Hartford Hospital, she effectively killed the proposal, Sen. President Donald Williams, D-Brooklyn, said Tuesday.

“Unfortunately I think the governor’s opposition at this time effectively kills the project for this year,” Williams said. “I say unfortunately because the healthcare sector of our economy is one of the key sectors that we will be relying on to grow jobs in the future.”

He said the partnership between the hospitals and medical schools, which would include the construction of a ‘University Hospital’ with campuses in Hartford and Farmington, would have created 18,000 jobs. He said now it’s incumbent upon the governor to put together a plan to grow jobs and find money to make up the $17 million operating deficit UConn’s John Dempsey Hospital is running this fiscal year.

Rell’s Budget Secretary Robert Genuario said in this report that “The state cannot afford to take on the forecast debt service that would be necessary to construct a new hospital. A $475 million bond would cost approximately $750 million over 20 years and initially $50 million per year in annual debt services costs.”

Speaker of the House Chris Donovan, D-Meriden, said Tuesday that a lot of work has been put into this proposal and it’s important to keep the discussions going. He said he would like to have a solution by the end of the year.

“I think at this time to say it’s ended right now is shortsighted,” he said.

“I’m disappointed the governor chose now to come out with her opposition to this particular plan,” Majority Leader Denise Merrill, D-Mansfield, said Tuesday. “If not this, then what?” She said this is one of the major economic development assets of the entire region.

“If we’re not going to go forward with this plan then there needs to be an alternative,” Merrill said. 

“In light of the current economic climate and the enormous budget deficit the state must confront in Fiscal Years 2010 and 2011, I feel we cannot in good conscience make such a large financial commitment,” Rell said in her letter to the Higher Education Committee chairmen. “In short, this is an intriguing proposal but we simply cannot afford it at this time.” She said she would be willing to reconsider the proposal in the future once the economic picture begins to improve.

Sen. Minority Leader John McKinney, R-Southport, said he’s pleased the governor has weighed in and taken a new hospital solution off the table. However, McKinney doesn’t believe the governor or the legislature should be the ones who go back to the drawing board and come up with a new proposal. He said it’s now up to the University of Connecticut to sit down with Hartford Hospital to create a new solution which doesn’t include building a new hospital.

He said he still thinks there’s room for a partnership without construction of a new hospital.

The Higher Education Committee voted in favor of two bills, which addressed portions of the proposal Tuesday. One bill will go to the floor of the Senate and one will go to the floor of the House for further consideration.