(Updated 2:12 p.m.) As the state’s budget situation continues to deteriorate, Gov. Dannel P. Malloy is calling for bipartisan budget talks and a special session to cut an additional nearly $120 million from the 2016 budget.
Standing outside his state Capitol office Monday, Malloy said there’s been a significant downturn on Wall Street, and personal income is not rising as fast as expected. That’s why his budget office was expected to report that even after $103 million in emergency budget cuts last month, the state is running a $118.4 million deficit, only four months into the new fiscal year. A majority of the deficit is attributed to the $109 million drop in personal income taxes.
Malloy’s suggestions on where to cut the $118.4 million will be made next week and he ruled out tax increases as a way to close the budget gap.
Hampered by low approval ratings, Malloy has been criticized by members of his own party for some of the decisions he made in cutting nearly $103 million from the budget on Sept. 18. Democratic lawmakers criticized a $63.5 million reduction in funding to hospitals and a $16 million cut to the Department of Disability Services and Department of Mental Health and Addiction Services.
Democratic lawmakers were expected to release about $100 million in alternative budget suggestions this week. Meanwhile, Republican lawmakers have been calling for a special session to cut spending.
Malloy said both the round of $103 million and $118.4 million in spending cuts would be open to bipartisan suggestions. However, he warned, “any part you want to take out of the $103 [million] makes your job in closing the $118.5 [million] much more difficult,” he said.
“I’m not afraid to make those hard decisions,” Malloy said.
He said lawmakers have been known to give blank stares when they want a cut restored, but don’t know where to find the money to balance the budget.
“There have been a dearth of alternative suggestions,” Malloy said. “There have been people who have gone back to the well to criticize (what) I have done and I understand it. Quite frankly, I have very broad shoulders. This is not a reaction to the criticisms.”
He said he doesn’t believe he’s gotten a “serious response from anyone” with respect to how they would resolve the revenue shortfall.
“I’m calling everybody back,” Malloy said. “Come to the table. Bring suggestions.”
Senate President Martin Looney, D-New Haven, applauded the move.
Looney said legislative leaders were preparing to offer $100 million in broad cuts that would have restored funding for community hospitals and programs for the Department of Disability Services and Department of Mental Health and Addiction Services.
“In light of this latest projection, we are now facing a problem more than twice that size. I commend the governor for listening to the concerns of legislative leaders,” Looney said.
He said he’s also willing to work with Republican lawmakers on the budget as long as they’re serious about the recommendations they make.
House Speaker Brendan Sharkey suggested cutting 2.5 percent from the state budget across-the-board, which would save $125 million.
“This approach would have helped maintain the critical services that thousands of families rely on every day, and keeps much needed local property tax relief intact,” Sharkey said.
Sharkey said if Republicans are serious about joining them at the table, they will have to offer solutions that don’t touch Democratic lawmakers initiative to reduce property taxes by dedicating a half-percent of the sales tax to a municipal account to use in the future.
“If they are serious, like they claim, about wanting to be part of a solution, we welcome their participation, but one – they need to commit to and stay throughout negotiations; two – they need to come with real, specific ideas; and three – bring their votes,” Sharkey said.
Republican lawmakers have been calling for a special session to help remedy the current budget situation, but their attempts, until today, have largely been ignored.
Asked about the change of heart, Malloy said he was “calling their bluff.”
He said he figured Republican lawmakers would have already put something on the table, but as of Monday none of the ideas they may have to solve the budget mess have been made public. Republican legislative leaders said they were happy to share their ideas once they got to the table, but didn’t want them to be dismissed by Malloy’s administration.
Senate Republican Leader Len Fasano, R-North Haven, said he’s happy the governor and Democratic lawmakers are beginning to understand the state has a problem, but “he’s not calling anybody’s bluff.”
He said they’ve always told the governor their door is open and they’re happy to have a conversation about numbers, but they’ve even seen the governor’s office “slap away the Democrats suggestions.”
Fasano said in order for them to all to begin to have negotiations they will have to decide on the budget deficit.
“We have to determine what this number is,” Fasano said. “I think our numbers will bear out that the number is at least $400 million in the hole.”
He said after they decide on a deficit, then they can have a conversation about policy and what needs to be cut. He said they have a lot of ideas for what to cut, but he doesn’t want to solve a $200 million problem knowing they have another $200 million to go.
Fasano and House Minority Leader Themis Klarides said using any other number as a deficit would be “counterproductive and only lead to the need to adjust again a few months from now.”
“Budgeting is all about priorities. Serving the poor, elderly and other vulnerable populations while protecting state taxpayers are our priorities. Our decisions will not occur in a vacuum,” Fasano and Klarides said.