Gov. Malloy made $79 million in additional emergency budget cuts this week to help close an expected state budget gap of $220 million this year and “ensure that we don’t spend more than we actually have,” he said.

Late last week, he also asked for bipartisan participation in the budget-balancing process, requesting ideas from Connecticut state lawmakers on both sides of the political aisle by early this week.

Budget-Gaps_031816Responding to the governor’s request, GOP lawmakers presented a plan to patch the current deficit and get started on the next hurdle—a $900 million gap projected for next fiscal year.

The governor said that while he disagreed with aspects of the plan, if lawmakers passed it, he would sign it.

Legislative Democrats said they would reveal their ideas by the end of the week.

After a closed-door, bipartisan meeting this week, caucus leaders said they would act quickly to close the budget gaps.

State revenues continue to fall under projections and last week it was revealed that Connecticut’s jobs growth in 2015 was significantly worse than first thought.

New Reality

The news was unfortunate but consistent with what the governor had already identified as a “new economic reality” in Connecticut in his State of the State address last month, in which he outlined a plan to change how the state operates and budgets to meet the changed circumstances.

The governor previously made two other rounds of cuts and his latest round again includes reductions across many state agencies and programs.

But the governor also has officially notified state employee unions that the state’s workforce may have to be reduced in order to make the budget work for fiscal year 2017.

TIME-TO-ACT_Budget-ReformsAmong many other things, the governor in this round of rescissions ordered cuts in the budgets of the departments of Children and Families, Developmental Services, Economic Development, Education, Mental Health and Addition Services, and Social Services.

The GOP presented a plan that would patch the $220 million state budget gap with spending reductions of 15% in many budget areas.

Their plan would not require state employee layoffs—instead calling for two-day furloughs for all state workers—and would release state funding owed to Connecticut hospitals.

Republicans also proposed to reduce legislators' pay, eliminate some administrative positions, and cancel a payment into a sales tax revenue-sharing plan that's supposed to start next year, but likely won't get off the ground because of the budget crisis.

Legislative Democrats have said they are "examining targeted cuts to municipal aid that reflect avoidable inefficiencies and foster inter-municipal cooperation; looking at programs and agencies that are not providing services in a cost-effective manner; and reviewing existing state contracts with vendors."


For more information, contact CBIA’s Bonnie Stewart (860.944.8788) | @CBIAbonnie