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Rell's Plan To Cover Deficit Avoids Real Solutions

Hartford Courant Editorial

March 07, 2010

Gov. M. Jodi Rell's plan to eliminate the projected $504 million deficit in the state budget for this fiscal year doesn't meet the challenge posed by these difficult economic times.

This deficit mitigation plan, required by law and unveiled by the governor last week, leaves many of the hard decisions to her successor. Mrs. Rell is not running for re-election and will vacate the office when her term ends in January. By the looks of it, she's already in retirement.

The biggest chunk Mrs. Rell would use to plug the deficit hole for this fiscal year (which ends June 30) is the $219 million in rainy day fund reserves that had already been slotted to help balance the budget in fiscal 2011. The governor would offset that transfer of real money to 2010 with more spending cuts for 2011.

For example, she would reduce 2011 municipal aid by $45 million — but doesn't say how. The cuts aren't specified. She would save $3.2 million next year by combining two state holidays — Lincoln's Birthday and Presidents' Day — into one. But, as the governor notes, that would take collective bargaining to achieve. Is that a realistic savings?

The Rell deficit mitigation plan also zeros in on a favorite target — funds set up by the legislature for specific purposes. In her fund sweep of $58 million to bridge the 2010 budget gap, she takes $12 million from the Citizens Election Fund, leaving possibly less than what's needed for candidates who qualify under Connecticut's groundbreaking voluntary public financing system for state elections.

The governor also drains money out of funds that create high-paying stem cell research and green energy jobs — just the kind of jobs the state needs. These fund sweeps are counterproductive.

The governor's budget-balancing scheme saves money through further cuts to health care for poor people. But she could have mitigated the deficit even more had she not vetoed legislation in December that would have delayed a tax cut for rich families by changing the threshold for the estate tax. The mitigation plan is not equitable.

Finally, Mrs. Rell would shrink this year's projected deficit by deferring a $100 million payment into the state employees' pension fund, despite the fact that Connecticut has one of the worst unfunded liabilities in the nation. Deferring pension fund payments is not a responsible way to balance the budget.