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05/03/2017 08:30 AMManaging personal finances can be daunting at times, but its nothing compared to balancing a state budget when billions of dollars are on the line. At State Representative Sean Scanlon’s (D-98) Citizens Budget Workshop on April 24, Guilford residents took a stab at balancing the state budget, debating ideas and issues amongst one another, and hopefully giving Scanlon a few ideas to take back to Hartford.
More than 60 residents participated in the workshop, sitting in groups and looking over different options to balance the budget. Options were displayed on cards categorized as spending, revenue, innovative item, or structural changes and included ideas such as a sugary drink tax, tolls, legalizing marijuana, and raising the state sales task. Each card, or idea, had an associated monetary value, which residents could add to either side of a provided balance sheet to try and set the budget straight.
“We have a very difficult situation happening right now in Hartford with the state budget,” Scanlon said. “This year’s budget is about $40 billion—it is a two-year budget, so we spend about $20 billion annually as a state. In this fiscal year that is about to start on July 1, we are about $1.7 billion in the negative. The task before us now is to figure out how to balance that budget and, as you are going to see, it is not impossible, but it is difficult.”
Scanlon joked that he didn’t give residents every option in the budget because they would be there all week, but residents still worked for close to an hour and a half trying to balance the budget with the most popular solutions put forward by Democrats and Republicans.
After time was up, residents balanced the budget to varying degrees of success. Some ideas were popular among all groups, including a tax on sugary drinks and raising the cigarette tax. Most people said they wanted to see government protect vulnerable residents and do more to keep businesses in the state.
Proposals surrounding tolls or legalizing marijuana divided the crowd, as did taxes—while some said the wealthy should be taxed more, others said all residents in the state have been taxed enough.
While residents worked through the options, Scanlon said that one big part of the budget is not up for negotiation: pensions, specifically state employee benefits. In Connecticut, there is collective bargaining, meaning all unions bargain together in one collective unit.
Under former governor John Rowland, the unions negotiated to freeze their benefits and protect them from negotiation for 20 years. When Governor Dannel Malloy took office, he extended the deal another five years, meaning the unions are safe from negotiation until 2022. The unions can, however, opt to come to the table and make concessions—something Malloy is counting on in his budget proposal.
“This is a big part of why we are in the problem we are in today,” said Scanlon. “So when it comes to fixing our budget, you just have to realize that 31 percent of our budget is already going to something that you really can’t do much about…So until 2022, unless these unions come to the table and give more concessions, our hands are tied.”
With the options that are on the table, Scanlon said he was pleased to see Democrats and Republicans working together on creative solutions. He said he would do a workshop like this again and took plenty of notes to take back to Hartford.
“It seemed like the general theme of everybody’s comments was that they are worried about the state of our economy and the state of our deficit but there are certain investments that we do need to make to get out of that hole and I agree with that,” he said. “It is just a question of finding the right balance.”
The Governor’s Budget
As the budget process stands now, Malloy released his proposed budget on Feb. 8 that includes a redistribution of state aid to municipalities, labor concessions, and a plan to have cities and towns cover one-third of the state’s teacher pensions.
Under the governor’s proposed budget, Guilford would see a close to $2.2 million reduction in state aid, with significant shifts in grant monies from programs such as the Town Aid Road Grant, Local Capital Improvement (LoCIP), Special Education, and Education Cost Sharing (ECS). The ECS grant, a program that serves as the state’s primary financial resource to help municipalities run their schools, has been completely zeroed out, taking the town’s total ECS grant from $2.7 million this fiscal year to nothing in the next.
Additionally, under the budget proposal, Guilford would pay a portion of the teacher pensions. For years, teachers have contributed six percent of their salary to their pension and the state has picked up the rest of the tab. However, with contribution rates on the rise and the system underfunded in its earlier years, the governor is looking to push one-third or $400 million of the contribution onto municipalities. For Guilford, that means a bill for $2,865,342.
However, the governor’s proposal merely kicks off the budget process. The legislature is expected to release their budget in late April, and then throughout the month of May legislators and the governor debate the budget before a final budget is voted in early June.