House deliberates GOP-backed state budget plan

Courtesy of CT News Junkie Gov. Malloy

"The amended budget that passed in the Senate today is unbalanced, and if it were to reach my desk I would veto it", Malloy said in a statement Friday night.

Hartley, Doyle and Slossberg all warned they would not support the next state budget if it didn't incorporate a series of fiscal reforms they proposed.

CT lawmakers on Thursday were debating a bill that would close a two-year budget hole of $3.5 billion through a mix of increases to taxes and fees and shifting some teacher retirement costs from the state to municipalities.

House Minority leader Themis Klarides, a Republican, tells WCBS 880's Mike Smeltz that until now, Democrats had only acted like there were two options; vote for their party's plan or accept the huge across the cuts board looming in October.

Both the Democrat and Republican budgets made public in recent days were projected to be out of balance in the billions of dollars in future years, according to the nonpartisan Office of Fiscal Analysis.

The budget also includes $1.9 billion in education aid to cities and towns this year and would avoid large cuts to local education aid proposed by Democratic Gov. Dannel P. Malloy as part of a spending plan that would take effect if lawmakers don't pass a budget by the end of the month.

Republicans want to save $270 million in the new budget by scaling back employee pension benefits after 2027 - when the current benefits contract expires.

"There's been significant interest, at least in our caucus, in trying to broaden the base" of the sales tax, Rojas said.

Analysts say that surging debt and retirement benefit costs, coupled with declining income tax receipts, would be the major factors forcing a $1.6 billion deficit this fiscal year - unless state finances are adjusted.

"This revenue plan, it's an admission we are desperate." said Sen.

The package also includes an increase in the hospital tax.

Three moderate Democratic senators then announced they would not be voting for their party's version of the state budget, which contributed to a shift in majority support over to the GOP.

It's unclear when the GOP plan will receive a vote in the House. Republicans say these changes reduce required contributions into the pension fund starting right away.

Many Democratic leaders, the governor and union leaders have questioned whether the state can make these changes unilaterally or whether that would violate collective bargaining rules.

"The Republican budget will never be signed by the governor - ever", Ritter said. The change in how those costs are funded would generate about $91.9 million for the state in 2018 and $189.7 million in 2019.

Some Democrats also object to the Republican budget because it reduces income tax credits for the working poor far more than the Democratic compromise plan does.

Looney said that a vote for the Republican budget was a vote in favor of a continuing stalemate that could last into the fall. Malloy has been running government with his limited spending authority.

Communities would pay only the "normal cost", an actuarial term referring to the full amount that must be set aside annually to cover the future pensions of present-day teachers.

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