House Democrats met behind closed-doors for nearly two hours Wednesday afternoon to vet Gov. Dannel P. Malloy’s budget proposal for the first time as they work towards drafting their own.
It’s different than previous years because it’s the first time many lawmakers are dealing with a budget proposal from a governor in their own party. There are few lawmakers left from the late Gov. William O’Neill’s administration who remember what it was like to have two branches of government from the same party.
Rep. Patricia Dillon, D-New Haven, is one of the few lawmakers who served under a previous Democratic administration.
After the caucus she said the honeymoon Malloy is experiencing is longer than most because he doesn’t come from state government. She said the caucus is respectful of him at an extent because he came from a municipality and didn’t contribute to the current fiscal mess.
She said a lot of the caucus was informational, but there will be a time when it all gets pulled together and that’s “when opinions will be expressed.”
Rep. Jason Rojas, D-East Hartford, said there were a fair amount of comments made about Malloy’s proposal to eliminate the $500 property tax credit for middle income residents, but overall the atmosphere was positive.
Majority Leader Brendan Sharkey said it was positive because lawmakers understand conversations between Democratic leadership and the governor’s office are ongoing and under Republican administrations there was no conversation until the legislature’s budget was complete.
House Speaker Chris Donovan said in the past Democrats knew former Republican Gov. M. Jodi Rell wasn’t going to like what they proposed, but this year they’re working with a man who shares many of the same ideals.
Donovan said Malloy’s budget sets the right tone and includes some good details, but only time will tell what will ultimately be negotiated between the two sides.
Rep. Toni Walker, D-New Haven, who co-chairs the Appropriations Committee said her 10 subcommittees are only about half-way through hearing about Malloy’s budget and talking to agencies about the proposal.
“There are a lot of big ticket items we’re still trying to get our arms around,” Walker said Wednesday. Manufacturing Machinery and Equipment grant, the hospital tax, changes to Medicaid, and agency consolidations are some of the big ideas lawmakers are still trying to figure out, she said.
In about three weeks all the subcommittee chairs will sit down with Walker and Sen. Toni Harp to discuss what changes they want to make to Malloy’s spending plan. Then the Finance Committee will have to come up with a revenue proposal to match it.
House Minority Leader Lawrence Cafero,R-Norwalk, said his caucus also talked early Wednesday morning about the budget and what they will be doing to propose an alternative.
Rep. Sean Williams, R-Watertown, said he doesn’t believe Malloy cut spending enough. Malloy‘s budget cuts spending by $760 million in the first year according to the Office of Policy and Management. However, the legislature‘s Office of Fiscal Analysis disagrees with that analysis and estimates it cuts spending only $444.4 million because the state will have to spend about $326 million before it’s reimbursed by the federal government for the hospital tax. Alan Calandro, executive director of OFA, said Wednesday that the net total of spending cuts in the governor’s budget is about $770 million, which is similar to what OPM is calculating.
The bulk of Malloy’s spending cuts will depend on his ability to negotiate $1 billion in savings each year of the budget with the state employee unions. A move that is likely to be highly unpopular with many progressive Democrats, including Donovan.
“There is going to be an all out war on that side of the aisle,” Williams said.
That all-out-war may have begun to take shape Tuesday evening when Malloy attended a town hall meeting in Donovan’s hometown of Meriden.
In public Donovan and Sen. President Donald Williams, D-Brooklyn, continue to say they are working with the Malloy administration to come up with a fair and balanced budget.
“We are working to reach a consensus with the governor’s administration,” Williams said outside the Senate chamber Wednesday. “We plan to adhere pretty closely to what the governor proposed.”
While many Democratic lawmakers give Malloy credit for holding 17 town hall meetings across the state to give residents an opportunity to address their concerns, many are working silently to change some of his proposals.
In Meriden, Donovan said a fair amount of people came out to talk about middle class tax relief. He said they think there’s room to tax some of the wealthier residents in the state.
Rep. Joe Aresimowicz, D-Berlin, said there has to be a way to collect the benefit the wealthy received from the Bush tax cuts and divert those gains, at least temporarily, to the state through an increase in the income tax.
Malloy increased the number of income tax brackets from five to eight in his budget and increased the rate on the wealthiest residents by just 0.2 percent to 6.7 percent.
He has said that since the wealthy faced a 1.5 percent increase in incomes taxes just 17 months ago they shouldn’t be asked to contribute more. Malloy also said his policy was to benchmark his tax increases to those of surrounding states. New York’s income tax is scheduled to drop on July 1 to 6.85 percent, so Malloy set Connecticut’s income tax on the wealthiest residents at 6.7 percent.