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Republicans Pitch Tax-Hike-Free Budget Plan

CHRISTOPHER KEATING

April 17, 2009

Sharply criticizing a Democratic plan to raise state taxes by $3.3 billion over the next two years, Republican legislators released a "no tax increase" budget Thursday that would consolidate 23 state agencies into six and be $1 billion less than the Democratic plan.

The Republicans said they would preserve school and municipal aid and restore the popular $500 property tax credit that would be eliminated for some families under a Democratic proposal passed by a committee two weeks ago.

Republicans have criticized Democratic plans to enact a 30 percent surcharge on corporate profits and raise the state income tax on individuals earning more than $132,500 and couples earning more than $250,000 annually.

The Republican plan is the third proposal on the table, following separate offerings by Gov. M. Jodi Rell and the Democrats. Budget talks are scheduled to start Monday. The final plan must be approved by the House of Representatives, the Senate and Rell as lawmakers try to craft a budget before the legislative session ends June 3.

House Speaker Christopher Donovan and Senate President Pro Tem Donald Williams said the Republican plan has some merit, particularly in conceding that the state budget deficit is higher than Gov. M. Jodi Rell has publicly acknowledged.

Rell and lawmakers have been arguing over the size of the deficit for more than two months. The legislature's nonpartisan fiscal office has projected the gap at $8.7 billion over the next two fiscal years.

Rell released a budget in early February with a deficit of $6 billion, and now estimates that the projected deficit would be nearly $7.4 billion over the next two fiscal years. The plan offered by Republicans Thursday estimates the deficit at $8.1 billion.

"We cannot — we must not — raise taxes at this time," said House Republican leader Lawrence Cafero of Norwalk. "We will not get out of this mess unless we do it together."

Cafero, who said Republicans want to avoid layoffs, said he believes the plan could result in 4,000 to 6,000 fewer jobs through attrition and retirement incentives.

The Democrats did not dismiss the Republican plan out of hand, although they disagreed with much of it.

"It's a house of cards built on a pile of sand, but at least they're trying," said Derek Slap, a spokesman for the Senate Democrats. "We're not saying the whole thing is garbage."

Republicans have denounced the Democrats' plans to start applying the state's 6 percent sales tax to currently exempt items such as bicycle helmets, child car seats and college textbooks. Republicans also want to eliminate the Citizens' Election Fund, thus ending public financing of campaigns that had been debated bitterly for years. That idea would save $60 million, but would return campaigns to the old way of being funded completely by private interests.

But Rep. Christopher Caruso, a Bridgeport Democrat who led the drive for reform, said eliminating the election fund is "the wrong thing to do," as the program is still in its infancy. The 2010 election will be the first gubernatorial campaign with public financing.