By State Senator
Dan Debicella
All families are being hit hard by this recession.
Connecticut state government is no different, and we
have immense budget deficits for this year and next.
I want to share some ideas about how we can close these
budget gaps without raising taxes.
Tackling Today’s Deficit. The General Assembly
held a special session on November 24th to enact Governor
M. Jodi Rell’s plan to eliminate up to $300 million
of the current state budget deficit. While this plan
will not entirely eliminate our budget deficit for this
fiscal year, it is a good start and I voted for it.
Key elements of the plan include:
• Governor Rell using her existing budgetary
authority to order $180 million in spending cuts, freeze
hiring, ban travel, and reclaim unspent funds.
• Implementing a tax amnesty plan under which
those paying back taxes will not be charged a penalty,
and save 25% in interest.
• Delaying numerous new government initiatives
scheduled to go into effect in early 2009.
• Expanding the Governor’s authority to
transfer funds between state agencies to cover deficits
in one agency with surpluses from another.
Under current projections, we have another $250-300
million deficit for this year—and things could
get worse if revenue continues to fall in the face of
declining income and sales tax receipts. I believe we
need to cover these with further spending cuts, perhaps
from “contingency” funds included in last
year’s budget that are now “nice to have”.
We will not see draconian spending cuts this year—but
next year is another story.
Tackling Tomorrow’s Deficit. Next year’s
budget deficit is estimated at $2.4 billion dollars—
15% of our total state budget. As a point of reference,
the state had a $1 billion deficit in 1991 when the
income tax was created. So needless to say, things are
very bad.
Why are we projecting this deficit? First, state revenue
is expected to shrink by 2-3% because of lower income
and sales taxes (the state’s two primary sources
of income). Second, state spending is automatically
expected to increase 7% next year due to union contracts,
increased Medicare/Medicaid payments, and inflation.
Obviously, there are only three ways to eliminate the
deficit: cut spending, raise taxes, or use the state’s
$1.4 billion Rainy Day Fund, our savings from previous
state surplus funds.
I believe we should look to cut spending first, and
then use the Rainy Day Fund to close any remaining gap.
I am opposed to raising taxes, especially during a recession
when our families are being hit so hard. Making decisions
about cutting spending will be hard; there are many
worthy programs and ideas that we will need to trim,
delay, or eliminate.
Most politicians will not tell you what kind of spending
they want to cut because they want to wait for someone
else to make the hard choices. I want to be a different
kind of leader, so let me be very specific in the types
of spending cuts I support:
• Renegotiate union contracts. Personnel is the
largest expense state government has and we need state
workers to help us eliminate the deficit. Specifically,
state workers (including me) get terrific healthcare
for very small co-pays and very small deductibles. I
believe we should raise these to match the private sector
to save taxpayers hundreds of millions of dollars per
year.
• No budget increases for any state agency. If
we insist that no agency get an increase, we would eliminate
about half the deficit. This is not as easy as it sounds—we
would be asking them to live within their current budgets
despite inflation and expected increased in their case/work
loads. However, I believe that every agency can find
3-5% of waste in their budgets if we insist.
• Eliminate underutilized programs. Connecticut
funds thousands of programs, yet I do not believe we
have ever done a comprehensive benefit/utilization review.
I plan to research this to see if we can eliminate programs
that are no longer needed or duplicated elsewhere.
These ideas are the beginning of a framework to cut
spending. Note that I do not advocate drastic cuts in
education or healthcare; the bottom line is that we
need to share the sacrifice across numerous constituencies,
not make draconian cuts in any single area that will
harm Connecticut in the long run.
The Governor has asked state residents for their ideas
about resolving the state’s budget crisis and
has gotten many good suggestions. I am also looking
for your ideas. If you have an idea about how to cut
the deficit, please give me a call or e-mail at the
number/address below.
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.
| 
