HARTFORD, CT – Gov. Ned Lamont said the impact COVID-19 has had on Connecticut’s state budget is sobering, but he’s not sure he wants to ask labor to reopen their contract.
“We are going to have to streamline things, make some cuts, work in collaboration with our friends in labor,” Lamont said.
Asked if he would reopen the 2017 labor agreement, Lamont said he would be talking with labor, but was vague about what that means.
“I’m going to sit down with my friends in labor and see how we can work through this together,” Lamont said.
Will he ask them to reopen the contract? “No,” Lamont said.
Asked if he would request a voluntary giveback of some kind, Lamont said, “Could I get back to you on that?”
Reached later Friday, the State Employees Bargaining Agent Coalition said officials from the Lamont administration asked for a meeting to discuss “the fiscal situation caused by the ongoing COVID-19 (novel coronavirus) crisis. Leaders of the 16 unions in the State Employees Bargaining Agent Coalition (SEBAC) have agreed to meet in order to hear more.”
The meeting has not yet been scheduled.
Some Republican lawmakers have been asking Lamont to cancel scheduled raises for state employees that go into effect on July 1. Under the 2017 State Employees Bargaining Agent Coalition deal, state worker pay increases include a 3.5% general wage increase and an annual step increase of 2%. The raises are estimated to cost the state $119 million from the General Fund and $15.3 million from the Special Transportation Fund, which covers the cost of employees at the Transportation Department.
At least four state employees with COVID-19 have died, including three workers from the Southbury Training School, and one probation officer from the Stamford courthouse. The Correction Department says 333 staff members have tested positive for COVID-19, as well as 428 inmates, and three inmates have died. The department says 150 staff members who had tested positive have been cleared to return to work, and 259 inmates who had been infected have been cleared to return to their original facilities.
The state will be getting $1.4 billion from the federal government to handle expenses related to the coronavirus pandemic. But that sum is not enough to solve the state’s revenue problem.
The state is looking at a $900-million deficit this year, and a $2.1-billion deficit next fiscal year. The general fund shortfall, according to the nonpartisan Office of Fiscal Analysis, will swell to $3.2 billion in 2022.
“All of us are going to have to do more on the fiscal front,” Lamont said.
Melissa McCaw, secretary of the Office of Policy and Management, said they will begin putting together a deficit mitigation plan for fiscal year 2021.
She said economists are predicting that the economy will rebound by 2022.
“It’s V shaped,” McCaw said. “It’s sharp. It’s downward.”
The $900-million budget shortfall for the budget that ends on June 30 will come from the $2.5 billion rainy day fund. The state will close the year with a $1.9 billion rainy day fund, which won’t cover the following year’s budget deficit.
McCaw said their deficit mitigation proposal will hold revenue flat and where there might have been an opportunity to give additional tax relief “we’ll likely be proposing to hold the line on those types of changes.”
She said there will be about $100 million in revenue changes as part of the deficit mitigation and about $415 million in rescissions and other deficit mitigation measures. McCaw said those measures will reduce the shortfall to $1.8 billion.
The administration will need the legislature’s help erasing the rest of the deficit.