2017 Session: The Good, the Bad…the Budget?

While the 2017 General Assembly ended this week, bringing some positive legislative changes, the session’s major issue—the next two-year state budget—remains unresolved.
Budget negotiations are expected to resume next week. With June 30—the end of the fiscal year—looming as a critical deadline, there is growing uncertainty that a budget will be approved by that date.
“We started this year with Governor Malloy calling on legislators to provide Connecticut citizens and businesses with the stability and certainty they need to invest here,” CBIA President & CEO Joe Brennan said this week.
“However, failure to adopt a new two-year state budget delays our ability to make the structural changes necessary to get Connecticut back on track and gain that stability and certainty.
“Employers are looking for a sense of urgency among policymakers to aggressively attack our short-term deficits and long-term unfunded liabilities.
“That means bringing state employee benefit packages in line with what most Connecticut taxpayers receive, streamlining state government, and limiting spending to the core priorities.”

Closing the Deficit

If the legislature fails to adopt a plan to close the state’s $5.1 billion deficit by June 30, Governor Malloy would administer state spending based on the current year’s budget.
Lawmakers did erase the $317 million deficit for fiscal 2017, using most of the state’s rainy day fund, withholding $19.4 million in casino proceeds from cities and towns, and sweeping revenue from other funds.

"As we look towards the special session, it's now critical that lawmakers work in a bipartisan fashion," Brennan said.
"We need a state budget that encourages investment, creates jobs, and generates economic growth as well as giving business owners confidence in the state's future."

'Partial Success'

Brennan said that the budget aside, the business community should view the legislative session as a partial success with a number of workplace mandates defeated and the adoption of some positive measures.
"Greater balance in the legislature made it difficult to reach consensus in many instances," Brennan said.
"However, the new dynamic helped stop the job-killing bills that either passed or got serious consideration in past sessions.
"It also encouraged lawmakers, in certain circumstances, to work together to pass bills that will grow the economy."
This year, lawmakers passed a number of measures that will help employers, including:

• An angel investor bill broadening small businesses access to critical capital
• A bill streamlining the workers compensation claims process
• Requiring a ratepayer impact statement for any bill with a financial impact on electricity consumers
• Creation of a small business hotline
• Establishing a Brownfield Land Bank to facilitate the development of environmentally impaired properties
• Approving a lock box to protect transportation funding, pending a November 2018 referendum

Mandates Blocked

Legislators also moved forward on workforce development, giving the Connecticut Technical High School System independence from the state education system to better focus on career-building potential.
Also, a variety of studies and task forces designed to review economic growth issues passed through both chambers.
"In addition to passing positive bills, legislators also stopped many bills that would have made the state less competitive at a time when we can ill afford any negative economic news," said Brennan.
Those proposals included mandated paid family leave, a minimum work week, minimum wage increases, and a workers compensation bill that would have allowed a claimant to sue in civil court before administrative remedies are exhausted.