By SUSAN HAIGH
HARTFORD, Conn. (AP) _ The General Assembly’s two budget committees on Friday voted out state spending and tax proposals, but Democratic lawmakers stressed how the final budget deal will be crafted over the coming weeks in negotiations with Gov. Dannel P. Malloy.
That means some aspects of the two bills, such as deep cuts to the state’s hospitals and the level of tax increases, could change during the closed-door talks. Lawmakers and the Democratic governor face a June 5 adjournment deadline to reach a deal.
For example, Sen. Toni Harp, D-New Haven, co-chairman of the Appropriations Committee, said her panel intentionally left intact Malloy’s proposal to cut more than $550 million over two years in aid to hospitals, mostly to help cover the cost of uninsured patients.
“I think that it’s too much,” Harp said of Malloy’s cut. “But I don’t think that we could address it without as well having a conversation about revenue. And so, until we have a conversation about revenue in our state, I just don’t see how we address it.”
Harp said it has been a very difficult budget to craft, given the state’s financial challenges. She spoke of seeing grown men cry at public hearings.
“The truth of the matter is, people are hurt by this budget,” she said. “But you know, we just don’t have the money to do a lot of the things that we would like to do.”
Whether to raise taxes beyond what’s included in the tax package approved Friday by the Finance Revenue and Bonding Committee, 31-17, will be a key component of the upcoming negotiations. There are some advocacy groups for the needy pushing for higher income taxes on the wealthy, requiring multi-state corporations to pay taxes on profits earned in Connecticut, higher cigarette taxes and other levies.
But House Speaker Brendan Sharkey, D-Hamden, said Democrats need to stand for not raising taxes, even though some members, including his House Majority Leader, have said higher taxes should not be taken off the table during negotiations.
“I think that’s an important message for the public,” Sharkey said. “And if it is even on the table, ever, it needs to be an absolute last resort. I’m not convinced yet that that’s something we need to do. I’m not.”
The legislature’s minority Republicans said they expect a push for higher taxes.
House Minority Leader Lawrence Cafero Jr., R-Norwalk, said the budget plan approved Friday along mostly party lines does nothing to boost the state’s economy.
“The document paints a very bleak picture,” he said. “It does not signal to the private sector that we are the place to be. And what it basically does say is, we are going to continue (with) the road we’ve been down” of borrowing and higher taxes.
Predicting Republicans will not be invited to participate in the final budget negotiations, Cafero and Senate Minority Leader John McKinney, R-Fairfield, criticized the Democrats for not stopping a previously planned increase in one of the taxes on gasoline, wanting to change the rules of the state’s constitutional cap on spending, and protecting legislative commissions at the expense of scholarship money.
Sharkey accused both of taking “potshots” and “marginalizing themselves” by running away from a difficult budget situation.
In a written statement, Malloy’s budget secretary, Ben Barnes, said there are “problems that need to be addressed” in the Democrats’ budget proposal, such as education reforms. The committee’s plan, for example, cuts funding to planned, new charter schools.
“As it stands, this proposal doesn’t get there,” he said, adding how the legislation is a good step toward “putting together a responsible budget.”
The tax bill approved Friday delays Malloy’s proposal to slash car taxes until the 2018 assessment year _ an issue that could be addressed later in the legislative session. It also scraps his plan to begin restoring a $50 sales tax exemption on clothing and footwear over two years. But like Malloy’s budget, it extends the 20 percent corporate income tax surcharge until income year 2015 and creates a tax amnesty program to collect back taxes.
While the legislation restores Payments in Lieu of Taxes reimbursements for state-owned property to cities and town, and restores funding to municipalities from some of the state’s share of slot machine revenues generated at the two tribal casinos, the Connecticut Conference of Municipalities said it remains concerned about that so-called unrestricted state aid is cut by $150 million.
“Cuts in state aid to municipalities will cause increases in local property taxes, cuts in municipal services and layoffs of municipal employees and teachers,” CCM said in a written statement.
The Appropriations Committee budget, which increases total net spending by $49 million beyond Malloy’s two-year $43.8 billion budget, restores funding to continue providing the state’s HUSKY A health insurance coverage to an estimated 37,500 needy parents. Malloy’s budget cuts their coverage beginning Jan. 1. He contends the parents will be able to take advantage of new federal subsidies to help them buy private insurance from the new health care exchange.
Some parent said they couldn’t afford the new premiums and co-pays.
“Basically we would go from being insured to being uninsured,” said Frances Taylor, a HUSKY A recipient from Manchester. “The reality is that people who are creating these state budgets are not in touch with families like mine.”