A state budget PowerPoint leaked to NBC Connecticut reporter Max Reiss shows that Gov. Dannel P. Malloy plans to cut $569.5 million from the general fund in 2017.
Malloy is expected to unveil his budget to the General Assembly on Wednesday, but several key lawmakers and state agency heads received briefings in advance.
According to the leaked PowerPoint presentation, which sources confirmed are accurate, Malloy will implement a 5.75 percent across-the-board spending cut for state agencies and non-educational municipal aid to save $360.8 million. There’s another $118.2 million in specific budget reductions, and the administration plans to roll out the spending cuts it made in December to save another $90.5 million.
The budget, according to the narrative in the document, protects “certain core services from deep cuts, including ECS [Education Cost Sharing] and entitlements.”
Malloy also will change how the budget is administered by eliminating specific line items for programs in each state agency and replacing them with a block grant. The new system would take some power away from the General Assembly, which currently can control the amount of money that goes to specific programs or services.
As promised, the budget does not include new taxes or tax increases.
Malloy also will renew his call to repeal minimum bottle pricing on alcoholic beverages. Small package store owners have defeated the proposal several years in a row because they fear the big package stores and grocery stores will be able to charge less per bottle and put them out of business.
Malloy has said the minimum bottle pricing is what’s driving Connecticut residents to other states to purchase cheaper alcohol.
Malloy also plans on capping Probate Court fees on estates at $40,000.
Last year, the legislature stopped funding the Probate Court system, a total of $32 million over two years, and forced them to raise their fees in order to sustain their operations. In addition to requiring the Probate Court to become self-sustaining, the $12,500 cap on probate court fees was eliminated and it doubled the fee on estates worth more than $2 million.
Meanwhile, the documents show Malloy, who is in the second year of his second term, is also thinking about future deficits.
The PowerPoint presentation suggests that the state will need to cut an additional 9 percent in discretionary spending in 2018.
Late last year, the Office of Fiscal Analysis projected the state will face $4.3 billion in budget deficits over the next four years.
But Malloy’s budget director, Ben Barnes, said last week that he thinks “the notion that we are foreseeing red ink in fiscal ‘18 is preposterous.”
He said he’s bound to report future deficits or surpluses, however, he’s not comfortable with the reliability of the numbers he’s forced to use to project those numbers.
The leaked documents show that in order to avoid a $695.7 million deficit in 2018, the state will need to cut about 9.7 percent from that year’s budget.
In order to “achieve a sustainable budget Connecticut must reduce discretionary spending by 15 percent over two years through service reductions, layoffs, efficiencies, and gains at the collective bargaining table,” the document reads.
The Malloy administration also plans on restructuring state employee and teacher pensions to avoid future fiscal cliffs and to constrain growth in fixed and entitlement spending “by reducing long-term fringe benefit costs, limited benefits under entitlement programs.”