Christine Stuart / ctnewsjunkie
House Speaker Joe Aresimowicz and Senate President Martin Looney (Christine Stuart / ctnewsjunkie)

HARTFORD, CT — Gov. Dannel P. Malloy said Thursday that he’s willing to scale back some of the changes to municipal aid that he proposed as part of his budget package earlier this year.

He still wants municipalities to contribute to the teacher’s retirement system, but at a reduced level and only for their current employees. The payments would be phased in over a two-year period. He had initially asked cities and towns to pick up one-third of the required contributions to the fund, which has always been controlled by the state.

Malloy will also increase the amount of money he plans to give to municipalities by $136.8 million in 2018 and $89 million in 2019. That’s more than $897 million over the executive order that would go into effect if the legislature fails to adopt a budget by Oct. 1.

Malloy also plans on releasing more information Friday about how he would phase-in a “progressive education funding formula” and smooth the transition for communities that will experience a shift in aid.

“The reality is that in an extremely difficult budget year, no one is going to achieve all of their priorities,” Malloy said. “There are no easy answers left or rabbits that we can pull out of a magical hat.  We have to meet one another in the middle and make difficult compromises, and we do it in a way that stabilizes the state’s finances over the long term. That’s what my budget proposal seeks to achieve.”

Democratic legislative leaders who spent more than two hours negotiating this afternoon with Republican legislative leaders said they’re encouraged by the governor’s proposal.

“We want to see the details of the document and then have discussions with the governor’s office,” House Speaker Joe Aresimowicz, D-Berlin, said Thursday.

Connecticut’s two municipal largest associations — CCM and COST — are waiting until they see the details to comment. Malloy is expected to release the details at a Friday press conference.

Democrats, who hold a slim majority over Republicans in the House and are evenly split with them in the Senate where Democratic Lt. Gov. Nancy Wyman can break a tie vote, said they are negotiating on parallel tracks. They are negotiating with the governor and they are negotiating with Republican legislative leaders.

By Thursday they were supposed to know whether they had enough agreement with Republican legislative leaders to continue those talks, but the verdict is still out.

“We’re still working to find consensus in some areas,” Aresimowicz said Thursday after the meeting. “It’s a little more difficult than I think we at first imagined.”

The two parties will meet again on Monday to see if they can reach agreement on some of the items put forward by Republicans.

“If this were easy it would have already been done,” Senate President Martin Looney, D-New Haven, said.

He added that if people want something other than the governor’s Oct. 1 executive order, then they do have to vote for a budget.

“Too many people on both ends of the spectrum have been holding onto their original positions for too long, in an unrealistic way,” Looney said. “The fact of the need for a budget has now become urgent. And people will know what the consequences will be if they’re not willing to compromise and vote for one.”

Aresimowicz said they are going to be working through the weekend and hope to have a budget to vote on by Thursday, Sept. 14.

That will likely give rank-and-file lawmakers less than 24 hours to read what could be hundreds of pages. Democrats have said they want to pass a budget deal and all the language that implements it in one omnibus package.