Hartford Business Journal

16 Hartford Business Journal • March 4, 2019 • www.HartfordBusiness.com Opinion & Commentary EDITOR'S TAKE Lamont's budget dazes and confuses taxpayers T axpayers who closely read Gov. Ned Lamont's first-ever budget proposal might have felt like they were in a featherweight boxing match. The first jab was $797 million in new sales tax revenues. Then Lamont taunted us with nuisance taxes on grocery bags and sugary drinks. Hospitals took a hard shot from the left through the proposed extension of the provider tax, which was supposed to shrink dramatically in the years ahead. Cities and towns also took a blow, having to potentially pick up part of the tab for the cash-strapped, teachers' pension fund. The attempted knockout punch was the $800 million proposal to adopt statewide tolling. So, where does Lamont's $43 billion, two-year spending plan leave beleaguered taxpayers and businesses? Dazed and confused could be an accurate description, but maybe not knocked down for the count. Lamont's budget has upset those on all sides of the politi- cal spectrum. Progressives say the Democratic governor didn't raise taxes enough on the wealthy; conservatives say it's just another example of a Democratic governor seeking tax increases to solve the state's budget crisis. Here's my take: To suggest the budget represents a "pro-growth" agenda, as some of the gov- ernor's marketing materials say, is political spin at its purest. Any spending plan that will drain hundreds of millions of additional dollars from taxpayers' pockets can't possibly be considered an economic boost to the state. Lamont's budget will raise the cost of living in Connecticut, making the state a less attractive place to live, especially if his toll proposal wins approval. That being said, things could have been worse. We all know the fiscal crisis Connecticut faces, largely a result of past politicians not paying into the state employee pension fund, which is now severely underfunded, threatening to cost the state billions of dollars in additional annual payments in the coming years. In the near-term, Lamont has to close a $3.5 billion deficit over the next two years. And his hands are tied in many ways because of the significant fixed costs in the budget, which legally can't be reduced without going through the collec- tive-bargaining process (More on that later). The good news is that he didn't raise income or sales tax rates and left intact the state's growing rainy day fund, which is projected to have a $2 billion-plus surplus by the end of this fiscal year. We are going to need those dollars when the next recession hits, which could be right around the corner. He also proposed a debt diet that reduces annual government borrowing by 39 percent, a good and necessary step following the reckless use of the state's credit card by Gov. Dannel P. Malloy. And the tolls revenue, despite being a tax- payer burden, could help fund needed transportation infrastructure projects. Other positives from Lamont's budget include restructuring the Teachers' Re- tirement System, eliminating the gift and business entity taxes, and exempting business-to-business transactions from the expanded sales tax on professional services. One area where Lamont's budget doesn't go far enough is state employee savings. He did seek concessions that would tie future cost-of-living increases for state em- ployee pensions to the rate of investment returns, but more should be done to reap further savings from a government workforce taxpayers cannot afford. I understand Lamont's options are limited — a short-sighted 2017 labor con- cessions deal hatched by the Malloy administration exempted most unionized state workers from layoffs through 2021 — but that doesn't mean the Demo- cratic governor shouldn't push for more savings. Yes, state employees have agreed to concessions on multiple occasions over the last decade, but what public-sector labor unions often forget is that their members work for taxpayers, not the other way around. Connecticut can't afford to pay for the services it used to provide, and must continue to prioritize funding it does have, rather than rely on new sources of revenue. Labor agreements shouldn't hold taxpayers hostage. OTHER VOICES Increase legislator pay, but with conditions By Benjamin Proto I magine a part-time job that gives you full- time and lifetime health insurance benefits, the ability to earn a pension, travel money and additional money for expenses that you don't have to prove you incurred. Sound like your kind of job? Then you should run for the Connecticut General Assembly. Recently, Roy Occhiogrosso, a political consultant, wrote on the need to raise the pay of Connecticut's legislators. Mr. Occhiogrosso correctly states that the starting salary for a legislator is $28,000 per year (leadership make higher pay). Unfortunately, Mr. Occhiogros- so doesn't take into account the $5,500 each Senator receives and $4,500 each House member receives for expense reimbursement that requires no proof of the expense having been incurred, the mileage reimbursement that each legislator receives (even when they carpool with another legislator), the medical and dental benefits they receive, as well as the ability to earn a pension and lifetime health insurance benefits. All and all, not too shabby for a part-time job. In addition, Section 2-3a of the Connecticut General Statutes pro- tects legislators who choose to work for a private employer from being disciplined by an employer for miss- ing work because of their legislative duties (employers are not required to pay the legislator for time missed but they cannot be terminated). Although Connecticut has a "citizen legislature," many legislators choose to make the job of "legislator" their full-time employment, knowing full well the compensation structure that exists for this position. Some are also full-time employees of the state employee unions that are subject to the budget and laws that are voted on by the same legislators. (See the Speaker of the House). The base salary of $28,000/year puts Connecticut in the top half of all legis- lature pay in the country and, once you take into account the add-ons, perks and other compensation, Connecticut legislators quickly move up the pay list. Having said all that, I agree with Mr. Occhiogrosso that Connecticut legislators' pay should increase. It has been over 15 years since lawmak- ers have received a pay hike. I would suggest, however, that any pay in- crease should come with changes to both the makeup and compensation structure of the legislature. First, we should maintain a part-time legislature. Any lawmaker who chooses to make being a legislator a full-time career has no understanding of what the rest of Connecticut's working women and men go through every day. Legislators should hold outside employment and our ethics laws should be modified to take into ac- count any conflict of interests that may arise from that outside employ- ment, including employment with a state employee union. Second, as this is a part-time, public- service position, legislators should not be eligible for health insurance benefits. Third, eliminate mileage reimburse- ments. The increase in pay should cov- er the cost to get to and from Hartford. A legislator should not be entitled to something working men and women aren't entitled to receive. Fourth, legislators should not be eligible for a pension or lifetime medical benefits. This is public ser- vice, not a career. Fifth, and most importantly, we must impose term limits. There are presently legislators serving who were elected in the 1980s. I would suggest term limits of five terms for legislators and two terms for governor and other statewide officer holders. This would allow for an appropriate turnover of members while allowing members the opportunity to spend an appropriate period of time serving the public. There is, of course, another option. We could simply go back to the original terms of the Constitution of 1965 and have the legislature only meet from January to early June in odd-numbered years and leave the state Capitol empty in the even-numbered years. Imagine how much money we could save if we didn't have to pay the cost of the legislature for one full year every two years, not to mention fewer laws that only burden rather than help our state. Benjamin Proto is a Stratford- based attorney and former counsel and chief counsel to the Connecticut House Republican Caucus. Greg Bordonaro Editor Benjamin Proto

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