HARTFORD, CT — Gov. Dannel P. Malloy let the last shoe drop on the bipartisan budget Friday when he released a spreadsheet detailing $181.6 million in lapses he planned to enforce in order to balance a budget he didn’t negotiate.
Legislative leaders, who spent a month negotiating the two-year budget, said Malloy’s decision to hold back $91 million in municipal aid was punitive in nature.
While they understand they deferred some amount of responsibility to manage the budget, Speaker of the House Joe Aresimowicz was not happy with the decision to cut education funding.
“I understand the Governor has the responsibility to manage the budget to keep it in balance, but his decision to again put a quick target on our towns and public schools is misguided,” Aresimowicz said. “Funding our schools is a clear legislative priority in the bipartisan budget just passed, so going after that particular funding raises serious questions and will no doubt bring strong pushback from all corners of the state.”
House Minority Leader Themis Klarides, R-Derby, agreed with her Democratic colleague.
“The governor’s brazen decision to ignore the intent of the compromise budget is bare sabotage, and the clearest indication yet that he’ll spend his remaining time in office working to punish anyone who has opposed his failed policies,” Klarides said. “He has no interest in reforming state government, rehabilitating our economy, or even considering the concerns of local leaders and the citizens legislators serve — the very people who appreciated our efforts to work together to avert his cruel cuts to schools and critical social services programs. Plain and simple, his sole focus is to break the budget and the lawmakers who supported it.”
Senate Republican President Len Fasano, R-North Haven, said he would never take Malloy at his word again.
“In true form, the governor is blatantly ignoring the will of the legislature, and doing what he wanted to do all along,” Fasano said. “He is going out of his way to dismiss certain savings and instead dramatically reduce funding to municipalities, turning a blind eye to the careful efforts of lawmakers to protect towns and cities as much as possible.”
The Malloy administration released what amounts to about $181.6 million in what’s termed a “lapse.” A “lapse” is an identified amount of money that policymakers believe will be underspent across some portion of the budget.
In recent years, an achievable lapse amount would have been around $100 million out of a $18 billion budget. That’s less than one percent.
However, this version of the budget, which took legislative leaders on both sides of the aisle a month to negotiate, includes much larger lapses or holdbacks.
As part of those holdbacks, the administration decided to withhold $91 million in municipal aid, including a reduction in Education Cost Sharing funds.
“Although we’ve only had a budget for 17 days, the fact is we’re already more than four months into the fiscal year, which means these adjustments need to be made now in order to achieve the necessary savings,” Office of Policy and Management Secretary Ben Barnes said. “State agencies and outside groups alike need to know what resources are available from the state budget for the remainder of the fiscal year.”
He added that based on the revenue numbers released earlier this week the governor may need to exercise his rescission authority or the General Assembly may need to take further action to balance the budget.
“These holdbacks represent real, difficult decisions that the bipartisan budget agreement requires state government to make,” Barnes said. “But they’re also necessary in order to give taxpayers, businesses, and bondholders the stability they need and deserve.”
Elizabeth Gara, executive director of the Connecticut Council of Small Towns, said what essentially ends up being a spending cut will impact municipalities.
“These additional cuts in municipal aid, combined with reductions included in the recently adopted budget, are taking their toll,” Gara said.
She said even though towns are doing much better now than they would have under the executive order, the additional cuts are difficult.
“The additional cuts in municipal aid are putting considerable pressure on towns and property taxpayers,” Gara said. “A lot of towns are wondering, what’s next? This uncertainty is making it difficult to move forward with contracts and projects that are critical to our communities.”
The Connecticut Conference of Municipalities said the cuts will be difficult to handle mid-year.
“Municipal governments will have increasing difficulty trying to managing their current year spending, having to again adjust for a shortfall in revenues less than a month after being told to count on a defined level of state aid,” CCM said in a statement.
• Here and here are the lists of the municipal aid holdbacks.
• Here is the total list of holdbacks, including the $700 million in savings negotiated as part of the State Employees Bargaining Agent Coalition agreement.
• Here is a more global description of the lapses.