HARTFORD, Conn. (AP) — Connecticut lawmakers moved closer Tuesday toward fixing the state's mid-year budget deficit by cutting spending and shifting money from accounts.
The plan also reduces some business taxes in hopes of improving the state's business climate.
But the General Assembly failed to secure enough votes for a resolution that could have potentially put a constitutional "lock-box" in place late next year, protecting transportation revenues from being spent on other programs.
By early evening, the deficit-cutting proposal had passed the Democratic-controlled Senate on a mostly party line vote of 20-15. The House of Representatives, also controlled by Democrats, was still debating the bill.
Democratic Gov. Dannel P. Malloy called legislators back to the Capitol for Tuesday's special legislative session after weeks of negotiations failed to produce a bipartisan agreement on how to cover an approximately $350 million deficit that has developed in the current $20 billion budget — about six months after the legislature narrowly passed the original budget.
Senate President Martin Looney, D-New Haven, said there wasn't a bipartisan vote on the package, but it did "reflect bipartisan thinking." Looney said common ground was found with the Republicans on issues such as reduced state employee overtime; plans to eventually close Southbury Training School and other state facilities for the developmentally disabled; and eventually reform the state's constitutional cap on spending.
But Republicans expressed disappointment with the package, saying it doesn't do enough to end the cycle of budget deficits Connecticut seems to experience year after year.
"Here we are again, doing another deficit mitigation package," said Sen. Rob Kane, R-Watertown. "I know we work on a two-year budget process, but we continue to have these negotiations, have these debates and they continue to put Connecticut further in a deep and deeper hole."
Some Republicans criticized the plan for transferring $5.7 million from various accounts to the state's general fund, such as the school bus seat belt account, and $15.1 million from public colleges and universities.
Ben Barnes, Malloy's budget director, contends the plan "puts us in good shape to end the year in balance."
The package restores some of the cuts Malloy imposed earlier to the state's hospitals, which launched a statewide ad campaign warning the reductions could harm services and patients, and to social service agencies. In particular, it restores more than $4.5 million Malloy had cut in September from grants to mental health and substance abuse treatment providers.
The plan also includes changes to the state's business taxes, some sought by the corporate community. For example, changes were made to way companies calculate their corporate income tax liability — an issue raised by General Electric Co., which has threatened to move out of Connecticut. Meanwhile, the sales tax exemption was eliminated for residential weatherization products, such as programmable thermostats and insulation.
Despite earlier calls from some lawmakers to possibly scale back Malloy's proposed 20-year, $100 billion transportation overhaul, no changes were made. However, there were not enough votes to pass a resolution calling for a constitutional amendment to create a so-called lock box for transportation revenues. Proponents fell 14 votes short of the 114 needed in the House of Representatives to put a question on the November 2016 statewide ballot.
It's now up to the 2017 General Assembly to put the question on the 2018 ballot, or else lawmakers need to try again next year with a revamped resolution.
Malloy wanted the lock box legislation passed quickly. His spokesman, Devon Puglia, said Tuesday's vote was still a "bipartisan step forward" and the administration is "going to keep pushing to ensure it gets done."