Fixing Connecticut’s Economy

Every day we read how our nation is facing an economic crisis—a meltdown on Wall Street, a downturn in housing, a looming recession. But our lives are not just impacted by the national economy; the local economy in Connecticut is crucial as well. We in Connecticut need to make sure that we do not slip into a deep recession; whatever happens on the national level, we in Connecticut must stay on track to do better.

A thriving business community is the key to growing our state’s economy. Businesses provide the jobs that Connecticut families depend upon, and generate tax revenues that mean government takes less from your household.

We want to be especially mindful of the needs of small businesses. Small business owners have created more than 90 percent of the new jobs in our state in the last 10 years. While big corporations are good to have in Connecticut, it is the little guy who is really driving our economic growth.

Connecticut government needs to ensure we have a business-friendly climate that encourages job-creation and wage growth. Shelton provides a prime example of how a government can attract businesses and make them an integral part of the community, through a combination of low taxes, strong infrastructure, and pro-economic growth policies.

Connecticut can do the same. I have proposed a five-point plan to get Connecticut’s economy growing and create more jobs in our state:

1) Expand Incentives for Job Creation. I was proud to author the jobs creation tax credit legislation that passed with bipartisan support in 2007. Under this law, Connecticut C-corporations that create 10 or more net new jobs in a year can qualify for a tax credit equal to 60 percent of each new worker’s state withholding tax. However, we need to expand this credit to any job created by any business so small companies can also have extra incentives to grow in Connecticut.

2) Reduce Burdensome Regulation on Small Business. Connecticut small businesses are buried under the weight of state regulations that end up costing them a lot of money without accomplishing anything beneficial for the state. The General Assembly should pass my proposal to require a cost/benefit analysis of every state business regulation every five years – and, unless the legislature votes to keep it, automatically abolish any regulation whose cost is determined to outweigh its benefits.

3) Attract Next Generation Industries. In 2006, the General Assembly created a movie industry tax credit that has been successful in brining film, and film-related, industries to Connecticut. We should extend this credit to emerging “next generation” industries that will create the types of jobs that will employ Connecticut residents for many years to come. Targeted “next generation” industry could include alternative energy, environmental remediation, optics and photonics, and life sciences devices and nanotechnology—industries that could be huge source of employment in the next ten years.

4) Fix Our Infrastructure. We need to improve both road and rail to ensure that transportation facilitates – not chokes – economic development. For our highways, that means relieving our “choke points” along I-95 and the Merritt Parkway through adding an additional exit lane (much like we did for the Sikorsky Memorial Bridge). For Metro North, we need to ensure we have ample parking at train stations like Stratford’s, and a comprehensive shuttle system to take people from the train to work in Norwalk, Stamford, and Greenwich.

5) Lower Taxes. Connecticut residents pay the highest taxes in the nation, and we need to lower taxes to encourage people and businesses to come here. While we might not be able to lower taxes next year given our $300 million projected budget deficit, I believe we need to set up the mechanism to lower taxes automatically in the future. Under my proposal, fifty percent of any future state budget surplus would automatically be used to reduce taxes. The other fifty percent could be used to reduce debt or added to the Rainy Day fund. Instead of spending any surplus we have in the future, we can guarantee it is returned to taxpayers.

We need to make Connecticut “open for business” to ensure that we have solid middle class jobs and a good quality of life. While we cannot control the national economy, we can make sure that state government is doing everything in its power to create jobs and grow our economy here at home.

Dan Debicella is the State Senator representing Stratford, Shelton, Monroe, and Seymour. If you have feedback for him or want to talk about the issues, he can be reached toll-free at (800) 842-1421 or by e-mail at dan.debicella@cga.ct.gov.