Appropriations Committee Leaves State Budget Untouched

The state legislature’s Appropriations Committee held its final meeting to act on bills April 4.

In an uncharacteristic move, the committee did not act on adjustments to the current two-year budget proposed by Gov. Ned Lamont. 

Instead, the committee will allow the current budget to be the baseline for continuing negotiations.  

Committee co-chairs Sen. Cathy Osten (D-Baltic) and Rep. Toni Walker (D-New Haven) highlighted the need to continue to focus on higher education, education, and nonprofit funding with the very limited available state dollars left.  

Ranking member Sen. Eric Berthel (R-Watertown) cautioned the committee to maintain the spirit of the fiscal guardrails that have provided the state with financial stability.  

The Lamont administration noted April 2 that there may be an additional $100 million in unused American Rescue Plan Act funds that could be used to fund the legislature’s priorities. 

Spending Cap

The original proposed budget that was initially under the spending cap is now $30 million out of balance, meaning that if the budget were re-opened, spending would need to be immediately cut.

Legislative leaders over the past few weeks have called for an increase in spending between $200 million to $400 million.     

The governor’s $26.1 billion fiscal 2025 budget proposal maintains the income tax cuts that took effect Jan. 1 and uses a series of lapses, carryforwards, and the last of federal pandemic relief funds to remain balanced and within the statutory spending cap.

What's happening in Massachusetts is a timely reminder about the importance of protecting and maintaining our fiscal guardrails. Prior to the adoption of reforms, we rode a rollercoaster of deficits and tax hikes that economic growth for a decade-plus. https://t.co/IeqK6t4Y3m pic.twitter.com/eHkeImAlFZ

— Chris DiPentima (@ChrisDipentima) April 3, 2024

That proposal maintains the fiscal guardrails, which are largely responsible for the state’s strong financial position.

The guardrails have allowed for six years of increased social program spending as a result of the $700 million saved annually by paying down unfunded liabilities.

The budget includes $43 million in early childhood funding in addition to the $50 million appropriated last year.

Budget Proposals

Proposed initiatives include: 

• $12.9 million for expanding Care4kids childcare subsidy eligibility for households who are 65% of the state median income versus the previous 60% of the state median income 
• Tri-share pilot in eastern Connecticut for childcare using $1.8 million in American Rescue Plan Act funds to leverage employer and employee investments to expand childcare access
• The creation of an Opportunity Center for state agencies to better coordinate service delivery and workforce development programs under a “one-stop shop” for residents 
• Investments in the state’s Councils of Governments to modernize shared service delivery among towns to help relieve pressure on local property taxes
• Elimination of initial occupational license fees for teachers, nurses, and home childcare providers

Other adjustments include: 

• $503 million in surplus Special Transportation Fund dollars to pay down debt service, leading to a savings of $25 million in fiscal 2025
• $1 million to the tourism fund
• $282,500 for the Department of Labor’s apprenticeship training program for new resources and positions focusing on healthcare, IT, and other new sectors
• Additional funding for the Department of Corrections to offset inflationary pressures and hire new corrections officers
• $70 million in savings due to changes in debt issuances
• 12 new positions at the Department of Mental Health and Addiction Services to assist homelessness programs and provide housing vouchers for individuals with autism
• $96,000 for one position added in Office of Healthcare Strategy to support expanded financial monitoring of hospitals and strengthen Certificate of Need reviews
• Connecticut was initially issued approximately $2.8 billion in federal American Rescue Plan Act funds which must be committed by the end of the calendar year, but can be spent through the end of the 2026 calendar year. 

While no committee budget was proposed, the legislature will continue to negotiate among the caucuses and with the administration. 

Any budget adjustments must be acted on by both chambers by midnight May 8.

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For more information, contact CBIA’s Ashley Zane (860.244.1169) | @AshleyZane9.