Legislative leaders and members of Gov. Dannel P. Malloy’s administration were meeting Thursday night to hash out a budget plan that rolls back some business taxes and doesn’t cut too much spending, but finds just the right balance to win approval.
A spokesman for Malloy said the governor is at the Democratic Governors Association retreat in Nantucket through Sunday but will be in contact with “staff and appropriate parties” as needed and will return immediately if any developments require him to be “physically present.” Malloy is on deck to become the chairman of the group of governors in 2016.
Meanwhile, legislative leaders said they are close to an agreement on the changes called for by Malloy.
Negotiations in Hartford revolve around the two-year, $40.3 billion budget narrowly approved by the General Assembly on June 3. After a little more than a week of vociferous opposition from the business community, Malloy announced plans to roll back some of the most objectionable taxes. He told lawmakers to find $223.5 million in spending cuts to get the budget to balance — or to authorize him to do it for them.
An across-the-board cut of 1.5 percent, according to a draft document provided to CTNewsJunkie by the governor’s budget office, would fall the heaviest on the departments of Development Services, Mental Health and Addiction Services, Social Services, and state colleges and the University of Connecticut.
While legislative leaders have been telling lawmakers to save the dates of June 29 and 30 for a special session to tie up loose ends including budget implementation language and some leftover bills, no official announcement has been made.
State Rep. Ed Jutila, D-East Lyme, said he’s prepared to come in on Monday and Tuesday but is available all week if that’s when he’s needed. Rank-and-file House Democratic legislators met behind closed doors Monday to offer ideas and get up to speed on what was happening regarding the budget.
What happens next — or when it will happen — was not clear as of Thursday.
“I want to see what our leadership comes back with after speaking with the governor,” Jutila said.
While discussions take place in secret at the capitol, people across the state — and beyond — are filling in the information void with their own spin. Press conferences have been held by those who want the budget to change, like the Connecticut Business and Industry Association, and those who want it to stay just as it is, like the “People Matter” coalition in support of human services.
In New Britain, union members representing the city and the higher education community gathered at Central Connecticut State University on Thursday to say the rich should not get a free ride while the rest of the people in the state pay their own way.
Sal Luciano, executive director of the union representing more than 32,000 state, municipal, and private sector workers, said the corporate tax rollbacks being considered “would affect only the largest and most profitable multi-state corporations — the very companies that already pay so little, so that families and small businesses have to pay more.”
Malloy announced on June 12 that he wanted to keep the computer data processing tax at 1 percent, delay unitary reporting until Jan. 1, 2016, eliminate the sales tax on car washes and parking, cap the tax on Internet downloads at 1 percent, and cap the amount of credits companies can use to offset their tax burden at 55 percent.
Otis Mamed, director of the CCSU student center, said the fallout from the ongoing budget battle could be detrimental to community colleges and state universities that each stand to lose $2.5 million per year if an across-the-board cut was implemented.
“This is simply not acceptable in a state that is home to extraordinary individual and corporate wealth,” Mamed said.
Both Luciano and Mamed said any taxes that are rolled back should be replaced with other sources of revenue from the state’s highest earners.
Meanwhile, other states are lining up to show those high earners that there are options. According to The Associated Press, Republican Florida Gov. Rick Scott will be in Connecticut today and Friday for a reception, business round table, and one-on-one meetings with big business executives.
The southern state recently took to the airwaves to woo big business away from Connecticut. Scott and Enterprise Florida Inc. — a public-private partnership between Florida’s business and government leaders that is the principal economic development organization for the state — began running the radio ads on Monday.
The Florida ad comes after a full-page Wall Street Journal ad from Indiana Gov. Mike Pence, which told GE, Aetna, and Travelers that Florida offers its support “in the wake of Connecticut’s looming tax increases, because friends don’t let friends pay higher taxes.”