As president of a manufacturing company that employs more than 200 people at two Connecticut locations, Okay Industries' Jason Howey understands that confidence in his business is based on consistency.
New Britain-based Okay delivers specialized products to the medical, automotive, and defense industries. The company's survival and growth depend on the confidence of its customers.
Howey reminded members of the General Assembly’s Appropriations Committee April 3 that consistency breeds confidence—especially when it comes to state finances.
Howey was among several speakers, including CBIA’s Pete Gioia and Brian Flaherty, who testified in favor of HB 6511, which seeks to put teeth into a constitutional spending cap voters approved 25 years ago.
When 81% of voters approved the cap, the idea was to mitigate the 1991 introduction of a state income tax by forcing lawmakers to keep increases in state spending in line with inflation and actual increases in personal income.
But lawmakers have consistently found ways to raise spending outside the cap’s restrictions.
So while Connecticut’s population has grown just 9% since 1992, and inflation has risen 67%, state spending has skyrocketed by 201%.
And that leaves us where we are today—facing a projected $3.6 billion deficit over the next two fiscal years despite the adoption of two of the largest tax hikes in state history in 2011 and 2015.
“I have great respect for the members of this committee who are grappling with a budget deficit of $3.6 billion over the next two years,” Howey said.
“A spending cap that mirrors what more than 80% of the voters intended back in 1992 could be useful in our current situation.
"That means keeping all expenditures under the cap so that its true objective is met.”
Connecticut needs to send a message that we are getting our act together to compete.
But a working cap will create a state budget that’s consistent and predictable, Howey said, and that will breed confidence.
“Confidence from the business community to create more jobs and invest in our state,” he said. “Confidence from prospective companies looking to relocate in Connecticut.”
A consistent state budget also “sends the message to Connecticut residents that there is a plan in place for the future to stabilize the budget” and minimize tax increases to ensure businesses and residents stay here, Howey said.
“Connecticut needs to send a message, not only to the residents of Connecticut but to the world, that we are getting our act together to compete.”