Christine Stuart photo

The leak of Republican budget documents to the news media will “chill” bipartisan budget talks, Senate Republican Leader Len Fasano and House Minority Leader Themis Klarides said Friday.

The document they presented to Democratic Gov. Dannel P. Malloy and the legislature’s Democratic leaders behind closed doors Thursday was leaked to the CT Mirror. Malloy’s budget proposal also was leaked and then released later Thursday.

Republicans released their budget plans publicly on Friday morning, but the anger over the leak and a proposal to offer state employees a Retirement Incentive Plan dominated the conversation.

“If you cannot speak frankly in a negotiation and feel comfortable with that confidentiality, then you chill the ability to make a good solution at the end,” Klarides said.

Fasano was a little more upset about the disclosure.

“If I can’t trust people in that room, it puts more than a chilling effect upon that room,” Fasano said.

He wants Democratic leaders to exclude the staff they can’t trust from the room. He said he trusts that the leak didn’t come from the governor’s office, but didn’t specifically accuse any of the Democratic caucuses.

One reporter suggested that they have the backroom budget debate in public.

Fasano said that’s “unrealistic.”

“You have to talk openly,” Fasano said.

Klarides said if the understanding is the conversation is confidential, then it should be confidential. She said she doesn’t know the details of who exactly leaked the documents, but she can guarantee it was an attempt to gain a “political advantage.”

“Unsubstantiated accusations regarding leaks are not helpful to the negotiation process,” House Speaker Brendan Sharkey and Senate President Martin Looney said in a joint statement. “We had a productive meeting yesterday.”

The House and Senate Democrats have yet to offer a proposal to close a $350 to $370 million mid-year budget shortfall. They’re expected to present a plan on Monday.

Christine Stuart photo

Following a House Democratic caucus, Sharkey said they went over the Republican proposal and Malloy’s proposal and solicited about what they can include in their package. However, he declined to comment on specific proposals, even though he expressed “caution” when it came to questions about the most controversial aspect of the Republican’s budget proposal.

The Republican’s put forth a Retirement Incentive Program, which would offer three years of service credit to employees who have reached retirement age but have chosen to keep working.

Republicans estimated the state could save $79.9 million in 2016 and $95.6 million in 2017 because the state wouldn’t be paying that in salaries and health benefits to about 1,800 employees.

“We look at the RIP as trying to help the immediate problem,” Klarides said.

Fasano said he believes the retirement incentive can be done legislatively and would not need to be collectively bargained. But there’s disagreement about that, and it’s unlikely to be something Malloy would agree to, since he’s invested in lowering the state’s unfunded pension liability. Currently, the governor is the only one with the authority to collectively bargain for health and pension benefits with state employees.

In 2009, former Republican Gov. M. Jodi Rell was unable to convince the unions to accept an early retirement incentive. Rell’s administration had estimated 8,000 employees, 52 years old or older, with 10 years of state service, would accept the offer and save the state $65 million.

On Friday, Fasano and Klarides pitched allowing the legislature to approve future negotiations for health and pension benefits. They also suggested a host of changes to the relationship between labor and the state, but none of those addressed the immediate budget shortfall.

Malloy’s office declined to address any specifics of the proposal.

“We appreciate the Republicans putting out their ideas,” Devon Puglia, a spokesman for Malloy, said Friday. “We will be reviewing them closely and working to find overlapping agreement.”

Sharkey said they’ve seen these types of proposals in the past and they “have limited impact on the current year budget and they also have a way of imposing long term liabilities on the state in terms of the pension fund.”

The largest line item in the Republican proposal seeks to divert $94.6 million from the Municipal Revenue Sharing Account, set up to accept the half a percent of the sales tax, which will be used starting in 2017 to lower car taxes for residents in about 30 municipalities. 

Fasano said the money can be used to plug the budget hole in 2016 because the program doesn’t actually start until 2017 and the money will be replenished. He said they didn’t completely cut the program because they knew it was a priority of the Democratic caucus.

“We are moving money that’s not being used immediately,” Klarides said.

The immediate problem, according to Klarides, is hospital funding, Medicaid and disabled people. She said if they have to figure out in the future where the money comes from for the Municipal Revenue Sharing Account “then so be it.”