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Legislature Adopts Bipartisan Plan to Close This Year’s Modest Deficit

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By Keith M. Phaneuf, Arielle Levin Becker, Mark Pazniokas and Jacqueline Rabe Thomas

 

The General Assembly overwhelmingly adopted a bipartisan plan on March 29 afternoon to close most or all of the current year’s budget deficit, immediately shifting the legislature’s focus to a far larger projected shortfall for the fiscal year beginning July 1.

The House of Representatives voted 127-16 just before 3:45 p.m. to approve the plan, roughly 90 minutes after the Senate adopted it 33-3. Nine Democrats and seven Republicans opposed the plan in the House. One Democrat and two Republicans voted against it in the Senate.

While the legislation eliminates $220 million in red ink in the budget year that ends June 30, it technically doesn’t reduce much larger shortfalls on the immediate horizon. Resources from off-budget accounts and other one-time sources of revenue covered 40 percent of the deficit-mitigation effort, or $87.2 million.

“This is to be celebrated I think for a day, then the hard work of the changes to the 2017 budget will be upon us,” Gov. Dannel P. Malloy told reporters as the House votes were being tallied.

Most of the remaining $133 million in cuts involved various small reductions applied to programs only for this fiscal year. Still, some legislators said many of those cuts will be employed again when the 2016-17 budget is adjusted later this spring.

Lawmakers expect hospital funds to be released

Still, leaders of the Democratic majority and the Republican minority hailed the plan. They argued it closes the current shortfall, mitigates future deficits and should trigger the release of $140 million in payments owed to hospitals that the Malloy administration has withheld in recent months.

“Today’s bipartisan agreement once again demonstrates that Democrats were willing to compromise in a way where we didn’t abandon our principles of protecting our investments in property tax relief, community hospitals, education, transportation and the safety net,” Senate President Pro Tem Martin M. Looney, D-New Haven, and Senate Majority Leader Bob Duff, D-Norwalk, wrote in a joint statement.

“This bipartisan package will preserve funding for the most vulnerable in the state, protect our towns from painful cuts, restore funding to our hospitals to care for the sick and elderly, and make the appropriate level of cuts to balance the budget and initiate savings for future years,” said Senate Minority Leader Len Fasano, R-North Haven.

Gian-Carl Casa, a spokesman for Malloy’s budget office, said the administration is on board with the new deficit-mitigation plan and would release the hospital funds.

But Rep. Craig Miner, R-Litchfield, said he’s still worried hospitals might not receive the funds if state finances take another turn for the worse, possibly in late April when state income tax revenues are analyzed again.

“It would be an awful message (to hospitals and their host communities) if the administration did not resume those payments,” Miner said.

Miner asked Rep. Toni Walker, D-New Haven, co-chair of the budget-writing Appropriations Committee, if Malloy administration officials had assured her the hospital funds would be released.

“We have not received that,” Walker replied.

The Connecticut Conference of Municipalities expressed relief that municipal aid wasn’t cut, given the lateness in the fiscal year.

“All spending cuts are difficult, but sparing towns from more mid-year cuts is evidence of a strong partnership between the state and local governments, and a real recognition of the interdependence of the state-local tax system when setting the tax burden on our residents and businesses,” said Joe DeLong, the group’s executive director.

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