Hartford Business Journal

6 Hartford Business Journal • January 26, 2015 www.HartfordBusiness.com Stay ConneCted For breaking and daily Greater Hartford business news go to www.HartfordBusiness.com. HBJ on Twitter: @HartfordBiz HBJ on Facebook: www.facebook.com/HartfordBiz HBJ on LinkedIn: www.linkedin.com/company/ the-Hartford-Business-Journal Daily e-newsletters: HBJ Today, CT Morning Blend www.HartfordBusiness.com/subscribe Weekly e-newsletters: CT Green Guide Weekly www.HartfordBusiness.com/subscribe By the numBerS $120.9 million The state's newly projected fiscal 2015 deficit, which nearly quadrupled since last month. 15 The number of layoffs UConn is planning this year out of its 4,700 employees. $20.83 The average hourly-wage for a manufacturing job in Connecticut, which is the fifth highest in the country. 41 Connecticut's ranking for its small business and entrepreneurship climate, according to the SBE Council. $2 billion The amount of money Delta Airlines, which has a Bradley terminal, thinks it will save on fuel this year. top 5 moSt read on HartfordBusiness.com ■ Hartford classic rock station debuts ■ World of Beer will open taps next week ■ Projected CT deficit grows, cuts coming ■ UI is 2nd best for customer satisfaction; CL&P 2nd worst ■ CT smokers the second-most costly top Story Projected CT deficit grows, cuts coming Gov. Dannel P. Malloy will be forced to make a second round of mid-year budget cuts after the state's projected deficit for the current fiscal year nearly quadrupled in size, the Office of Policy Management said. OPM is now projecting a general fund deficit of $120.9 million for the fiscal year ending June 30. That's up more than $89 million from last month's projection. Malloy announced $54.7 million in rescissions in November, but the move only reduced the deficit by $24.6 million. The deficit's steep increase is mostly the result of higher Medicaid spending and falling gas prices. The state's Medicaid deficit grew by $50 million, to $120 million. Barnes said the growing shortfall is the result of increased enrollment, difficulties in achieving savings on administration, additional hospital cost settlements, and revisions to the federal government's share of the costs for a small percentage of beneficiaries. Meanwhile, falling oil prices have led to a $24.8 million drop in the state's oil companies tax. eConomy Report: Hartford region's per capita GDP No. 2 in country Greater Hartford's economic output is the second-highest in the country, ac- cording to a new study released by The Brookings Institution. The region's gross domestic product per capita — the market value of goods and services produced here relative to the population of 1.2 million — was $76,510 last year, the study said. That put the Hartford metro area second in the U.S.; San Jose, Calif. was No. 1. Among the largest global metros, Hartford was behind only Oslo, Norway and Zurich, Switzerland. But with 0.3 percent GDP per capita growth between 2013 and 2014 and 0.4 percent employment growth, the region's growth is lagging in comparison, ranking 66th among U.S. metros and 239th globally, Brookings said. Economies that rely on financial services and business and professional ser- vices tended to grow more slowly, Brookings said, while those that rely on com- modities — such as Houston — grew more quickly. Developing economies, such as those in Asia and Eastern Europe, posted the highest growth rates. The Hartford area's GDP per capita and employment remain below 2007 lev- els, meaning it has not recovered from the recession. It has plenty of company in that regard, though more metros are crossing over into recovery. In the U.S., 32 of 80 large metros returned to recovery in 2014, up from just 17 in 2012, the study said. aeroSpaCe Former Pratt president comes out of retirement Former Pratt & Whitney President David P. Hess, who retired a year ago, will return to the company as the senior vice president of aerospace business development. Hess — who worked for parent company United Technologies Corp. for 34 years — will work with his Pratt successor, Paul Adams, and newly appointed UTC Aerospace Systems President Dave Gitlinto to "strengthen relationships with key aerospace customers and partners," UTC said. Hess is the latest in a series of top personnel changes at UTC since a surprise announcement in November that CEO Louis Chenevert would retire and be suc- ceeded by CFO Gregory J. Hayes. That shakeup brought Akhil Johri, a former vice president of finance, back to UTC to serve as chief financial officer. And last week, UTC said Alain Bellemare, CEO of its Propulsion & Aerospace Systems segment, would depart and the segment would be eliminated, leaving standalone companies Pratt and UTC Aerospace Systems. Analysts told Bloomberg last week that UTC could be gearing up for mergers, acquisitions or spinoffs. energy & utilitieS Feds deny Blumenthal's CL&P review The U.S. Federal Energy Regulatory Commission has denied the request made by Sen. Richard Blumenthal (D-CT) to review the recent rate case of Berlin electric utility Connecticut Light & Power. Blumenthal asked FERC Chairman Cheryl LaFleur to look into CL&P's ba- sic monthly power grid connection fee, which increased this year from $16 to $19.25, and examine whether FERC should cap such fees for utilities across the nation. Blumenthal's request raised the ire of the Connecticut Public Utilities Regulatory Authority, which approved the CL&P increase, especially after he called PURA's actions unconscionable, horrendous, and misguided. In the letter denying Blumenthal's request, LaFleur wrote that FERC doesn't have the authority to review state rate cases and any federal guidance on such issues must come from the U.S. Secretary of Energy. health Care CT smokers the second-most costly Each Connecticut cigarette smoker costs the healthcare system just shy of $2 million over their lifetime — the second-highest cost of any state, according to an analysis by WalletHub. WalletHub factored in what smokers in each state spent on cigarettes and calculated what they would have made if they invested that money in the stock market instead. It also calculated the effect of smoking on medical costs, employee absen- teeism and insurance premiums, as well as the impact of second-hand smoke on nonsmokers. Connecticut's high tobacco excise tax of $3.40 per pack played a major role in its ranking. Southern states where cigarettes cost less were ranked the cheapest. South Carolina had the lowest cost per smoker, at just under $1.1 million. Meanwhile, Alaska was most expensive, at just over $2 million. manufaCturing E. Windsor's Collins Pipe acquires Mass. supplier Collins Pipe & Supply Co. said it has acquired an eastern Massachusetts sup- plier, marking its first physical location in the Bay State. East Windsor-based Collins, which sells piping, valves and other products, said its purchase of Power House Supply Inc. will improve its customer capabili- ties in Massachusetts and Rhode Island. Power House employees will remain with the company, Collins said. Terms of the deal were not disclosed. Collins now has nine locations in New England, New York and Pennsylvania. CT manufacturing wages fifth-highest in U.S. Manufacturing jobs in Connecticut had the fifth-highest hourly wage in the country in 2013, according to an analysis by a think tank that focuses on the plights of middle and lower-income workers. Manufacturing jobs in the state that did not require a college degree paid an average rate of $20.83 per hour in 2013, behind Delaware, New Hampshire, Washington and Wyoming, which had the highest pay, according to the Eco- nomic Policy Institute. The manufacturing report breaks down each state by congressional district. Connecticut's fourth district, which covers much of Fairfield County, has the greatest number of the nearly 164,000 manufacturing jobs in the state, but the sector is more important to workers in the eastern half of the state — the sec- ond district — where a greater percentage of total jobs are in manufacturing. aCCounting W. Hartford accounting firms merge West Hartford accounting firms Massa & Co. and GitlinCampise have merged, the two announced. The resulting entity, which has 13 employees, has renamed itself to Gitlin- CampisePrendergast, adding the name of Massa principal John Prendergast. Salvatore Giuliano will be the firm's managing partner. Week in review Gov. Malloy gives his inauguration speech in January. P H O T O | C O n T r i b u T e d

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