As our nation faces an unprecedented financial crisis that threatens to wipe out jobs, investments, businesses and retirement savings, Connecticut confronts its greatest budget deficit in recent history. Both the non-partisan Office of Fiscal Analysis and the Office of Policy and Management agree that the deficit for the fiscal year ending in June will be approximately $300 million and is likely to grow to more than $2 billion over the next two fiscal years.
At the same time, the wages of working families aren’t keeping up with expenses. The rising cost of healthcare, home heating fuel, gasoline, food and other services, coupled with our state’s high tax rates have created conditions that many are finding hard to weather. It is clear that government at all levels is faced with very difficult choices.
Winter will soon be here. Record energy prices are on everyone's mind - and for good reason. Consumers could be paying more than $5/gallon for their oil this year and the cost of natural gas and electricity is rising as well. Connecticut offers many programs to help pay heating bills, improve energy efficiency in your home, provide incentives to install renewable energy systems, and to defray the cost of purchasing hybrid vehicles.
Because finding the program that is right for you can be a time-consuming challenge, many state programs are underutilized. We have put together an interactive citizen's guide to help you quickly identify the tax breaks and energy assistance you need for your home or business. Click the site icon above to explore this guide.
Here’s what Democrats do not want you to know: every time the price of gas goes up, it’s “good news” for the state treasury because of the Petroleum Gross Receipts Tax, which adds a 7% tax to the cost of gasoline in Connecticut.
So today, Representative Cafero and I wrote to every member of the legislature and asked them to sign a petition calling for a Special Session to cut and cap the Gross Receipts Tax, and require that such tax reduction be passed on to consumers.
We only need 6 more signatures in the Senate and a simple majority in the House to cut and cap the gas tax.
Connecticut motorists pay more than 50 cents/gallon in state gas taxes (more than half of which comes from the Gross Receipts Tax at today’s prices). That amounts to more than $7.50 every time you fill-up a 15-gallon fuel tank.
The Gross Receipts Tax was increased to pay for major transportation projects, but due to record gas prices, the state is taking in approximately $200 million in windfall revenues beyond what is needed for transportation. Today, nearly 60% of the revenue from this tax is being used to feed a bloated and growing state bureaucracy.
You can visit our home page to see if your senator has signed the petition to cut and cap the gas tax. If they haven’t, please contact them today and tell them that you don’t think Connecticut should have the highest gas tax in the region.
Last week we welcomed Governor Rell's support of the legislative Republicans' proposal to cap the state gross receipts tax on gasoline. Incredibly, in response the Democratic leadership said rising gas prices are a federal problem over which the state has no control.
Hiding behind the failures of our federal government is not leadership. Speaker Amann and Senate President Williams want you to believe that there is nothing the state can do to help reduce the price of gasoline. That's because they want to continue to spend the hundreds-of-millions of dollars in windfall profits the state is reaping from the growing energy crisis. Well, the last time I checked, neither President Bush nor the Democrat controlled Congress had control over our state gas taxes.
The truth that the Democrat leaders choose to ignore is, as state legislators, there is one factor contributing to the high price of gasoline that we can control, and that is the state gas tax. Currently, Connecticut gas taxes cost motorists more than 50 cents / gallon - one of the highest rates in the country. Since April, Republican legislators have been fighting to reduce that rate by cutting the gross receipts tax and permanently capping it. This will prevent the tax from increasing every time the price of oil goes up.
Democrat leaders questioned whether Governor Rell would support capping the gross receipts tax. Either they forgot or chose to ignore the fact that Governor Rell proposed capping the tax two years ago. Regardless, now they have no excuse. With Governor Rell's leadership and support, we are a step closer to providing a measure of relief to Connecticut families and businesses who are struggling to pay some of the highest gas prices in the nation. Legislative Democrats are the only impediment standing in the way of lower gas taxes in Connecticut.
With the April 15 tax filings in, the Office of Policy and Management revised last month’s surplus estimate downward 90% to just $15.7 million for FY08.
These revenue estimates underscore the need to act with the utmost caution and fiscal discipline as we meet over the next two weeks to negotiate the mid-term budget. In just one quarter, January to April, we have watched our surplus shrink by more than $240 million. If this trend continues, Connecticut will face a budget deficit in FY10 that could reach into the hundreds-of-millions of dollars. We need to look for efficiencies in spending and make smart decisions now to avoid that outcome.
It is imperative that the Democratic majority forgo its ambitious new spending proposals and all of its proposed tax increases, including the ill-conceived Delivery Services Tax. Connecticut residents are struggling with the rising costs of food, fuel, medicine and other necessities. A tax increase now would only further strain their lives and our economy.
Democratic leaders have, without apology or explanation, abandoned the promises they made to taxpayers and businesses just two short months ago and are now proposing significant tax increases. This is a striking reversal and one that could have a devastating effect on our economy.
In addition to a new “Delivery Services Tax” which would, for the first time, apply a 6% tax to the delivery charges of all goods transported in Connecticut including documents, products and groceries, a new Homestead Exemption will result in additional tax increases on Connecticut businesses by shifting the municipal tax burden to non-residential taxpayers.
Senate Republicans joined Governor Rell in calling for a nine-point ethics bill. These proposals will create a criminal penalty for public officials who fail to report a bribe, and give judges the power to revoke or reduce the pensions of corrupt public officials and state employees.
The Senate Republican Caucus stands ready to pass the nine-point proposal immediately, and we will continue to fight for additional ethics reforms including restrictions for state officials who lobby legislators, and the creation of a Standing Committee on Ethics.
We would prefer a bicameral standing committee to deal with ethical violations and acts of official misconduct, but short of reaching agreement across both legislative chambers, I again call on Senator Don Williams to join our caucus in establishing a Senate Standing Committee on Ethics.
A Senate Committee on Ethics can be created by a simple amendment to Senate rules and does not require the approval of either the House or Governor. According to the Office of Legislative Research, 41 state legislatures have designated committees to hear and investigate complaints alleging ethical or legislative rule violations committed by individual legislators.
I found my first state budget debate as a newly elected State Senator - and newly appointed member of the Appropriations Committee - to be quite an education.
As a businessman, I believe I was right to vote with the Republicans against the Democrats’ budget adjustment bill because we simply need more information. There are still several weeks left in the legislative session, and we have plenty of time to find out what we need to know before the full General Assembly has to vote on the budget adjustment bill for next year.
Certainly, if it turns out to make sound fiscal sense, I will be happy to vote in favor of a budget adjustment bill that calls for less spending than we expected to need and no new taxes for the next fiscal year. But, let’s take a closer look at the information we’re relying upon and see how much the state collects in taxes this spring before we make any final decisions.
I had hoped that the Democrats would support our Republican amendment to make some worthwhile changes to their budget adjustment proposal. Among other things, that amendment called for including my initiative to permit state audits of certain well-populated municipalities that heavily rely on state funding. Fortunately, my bill is on the Senate Calendar and we have plenty of time to vote on it before the end of the session. Still, I believe the taxpayers – who deserve to know that the state is spending their hard-earned money wisely – would have been well-served by including my initiative in the budget adjustment bill.
On Sunday I appeared on "Connecticut Newsmakers" on NBC-30 to discuss the economy, healthcare, and the mortgage crisis. I appeared with Democratic Senate President Pro Tem Don Williams, and the segment is 10 minutes long.
We need to change the debate on healthcare in Connecticut. We need to begin to focus on reducing the escalating cost of healthcare—which will benefit the middle class who is squeezed by increasing premiums and those who are uninsured because healthcare insurance is so expensive. The best way to reduce cost is also the best way to save lives—detecting disease before it happens. We need to get more focus on prevention and early detection for the most deadly and costly diseases such as cancer, heart disease, and diabetes.
The Senate Republicans’ “Tax Breaks For Healthy Living” initiative a great start to transforming our approach to healthcare. This proposed legislation would allow individuals and families who meet preventative care guidelines established by the state Department of Public Health to deduct out of pocket medical expenses – including premiums, co-pays and deductibles – from their state income tax.
Qualifying for the tax break would be easy—going to the doctor for your physical, and getting all the preventative tests suitable for your age and gender (e.g., mammograms, prostate exams). Doctors would qualify families by ensuring that they had all the preventative care screenings recommended– and then sign a one-page certification form to be included when they file their state income taxes.
This proposal will mean hundreds of dollars of tax breaks for the average family in Connecticut. But more importantly, it will save lives and lower healthcare costs for everyone. Catching cancer and heart disease earlier is sure to improve survival rates (which should be the focus of any healthcare proposal). But catching these diseases early reduces treatment cost by 80-90%, which would save hundreds of thousands of dollars per patient. One study states that if we can catch just 25% of disease cases earlier, we can reduce healthcare costs by $2 billion in Connecticut.
If we could pass $2 billion in lower healthcare insurance costs to consumers, that is a win for every Connecticut family. For those of us with insurance, we would stop having healthcare take an increasing portion of our families’ budgets. For those of us without insurance, we would be able to better afford basic insurance such as Governor Rell’s Charter Oak Plan.
This tax deduction would be the first of its kind in the United States. Connecticut has the opportunity to take the lead in improving the health of our families and reducing cost in healthcare, and I hope this becomes part of the upcoming budget.
Community providers -- organizations which provide services and supports for children and adults with disabilities and special needs -- provide excellent care and deserve to be fairly compensated for their work. We have failed, time and time again to accommodate these providers with realistic monetary increases that will allow them to continue to provide services to a community in need.
The Human Services Committee has proposed the creation of a Community Provider Rescue Fund Account And Community-Based Services Commission. The creation of this account, properly funded, coupled with the commission on community based services, will give the legislature a clear picture of the need for a constant revenue stream for these providers and a framework for solutions.
We have a responsibility to all of our citizens; this includes those who receive services from community providers and those who provide them. A cost of living adjustment should not be a policy decision or a negotiating chit in the budget. We owe it to our providers to adequately fund their services.
Public office is a public trust. During the past decade, that public trust has been betrayed time and again by elected officials and state employees who believed they were above the law. Yesterday I testified before the Government Administration and Elections Committee about the Senate Republican Caucus’ ethics agenda.
We have proposed creating a Bipartisan Standing Committee on Ethics; giving judges the power to revoke or reduce the pensions of corrupt public officials and state employees; establishing a criminal penalty for elected officials who fail to report a bribe; requiring ethics training for state elected and appointed officials and state employees; establishing new restrictions for state officials who lobby legislators; and prohibiting legislators from serving as municipal chief elected officials.
At the start of the legislative session, I presented this agenda to Senate President Pro Tem Don Williams and I am encouraged by the broad bipartisan support most of our proposals have received.
The General Assembly faces several important challenges this legislative session as we work to improve public safety, increase access to quality affordable health care, and help Connecticut residents cope with rising energy costs and a slowing economy. But, in order for state government to achieve its goals in any of these areas, it is vital we take the steps necessary to restore trust and public confidence in our elected officials.
In the wake of this past weekend’s fighting incidents at two state prisons, the legislature must pass a measure that would increase the staffing levels at all of Connecticut’s correctional facilities. Three fights between inmates at the Enfield Correctional Institution in Enfield and one fight at the Osbourne Correctional Facility in Somers should send a message to the legislature that prison staffing levels need to be addressed during the current legislative session.
While there is no indication that these incidents are related, it does shed light on how difficult and dangerous the jobs of those who keep watch over our state’s prison inmates really are. That is why I have proposed legislation this year that would increase staffing levels at all of our state’s prisons. Connecticut’s prison population has increased in recent months, and we need to be certain that our corrections officers have the appropriate tools available to them to ensure safety. The absolute first step in that process is to make sure these facilities are adequately staffed.
Connecticut is a wonderful place to live and work, but our success depends on our ability to hold the line against excessive government spending, and to institute long-term structural changes to our tax code that will strengthen our economy by attracting and retaining businesses and creating new jobs. Connecticut residents, families and businesses -- already saddled with some of the highest taxes in the country, transportation challenges and burdensome regulations -- are now also coping with the rising costs of energy and health care. As a result, business growth is slowing, unemployment rates are increasing, inflation is outpacing wages, and the average Connecticut worker at every income level earned less in 2006 than in 2002.
We must act now to restructure our government policies in a way that encourages economic growth through job creation.
As part of our long term plan to grow the state’s economy and improve our business climate, the Senate Republican Caucus is introducing a series of legislative proposals this year.
Our pro-jobs legislative package calls for expanding the 2007 Jobs Creation Tax Credit to benefit all businesses, and eliminate the need for businesses to first secure approval from the state Department of Community and Economic Development (DECD). Under our proposal, the credit would be applied annually to every net new job created. This new law would take effect on July 1st and make the credit applicable to income years beginning on or after January 1, 2008.
Also, Senate Republicans are calling for the legislature to repeal the annual $250 business entity tax, and to require DECD to conduct a cost/benefit analysis of all new and existing regulations every five years. And, finally, Senate Republicans are introducing legislation to promote “next generation” industries by extending the movie industry tax credit to industries that are likely to provide jobs for Connecticut’s middle-class working families. Targeted industries could include alternative energy, environmental remediation, optics and photonics, life sciences devices and nanotechnology. Companies that have not yet made a profit would be able to trade their tax credits to profitable Connecticut companies.
