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Women in Business — April 6, 2015

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36 Hartford Business Journal • April 6, 2015 www.HartfordBusiness.com OpiniOn & Commentary editorial Legislative trust issues plague CT's progress T rust issues can imperil any relationship and create a major roadblock to progress. Nowhere has that been on display more over the years than at the state legislature. A lack of trust in state lawmakers' ability to hold true to their promises has created an undercurrent of suspicion at the State Capitol that threatens to hold back Connecticut's ability to progress on many fronts. The latest example: Municipalities are raising a red flag to a proposal that would create a statewide mill rate for motor vehicles because they don't trust lawmakers to actually return the money to towns and cities. Local officials are right to be skeptical. For years, lawmakers have misappropriated funds to help plug budget deficits. The most egregious transgression has been raiding Con- necticut's special transportation fund to pay for general expenses, which has led the state to severely underinvest in its public infrastructure, hurting our economic competitiveness. The statewide mill rate for motor vehicles is part of a broader legislative package that promotes regionalism. Regionalism is a concept the business community can get behind because its goal is to lower the cost of local government and property taxes. Yet, there will always be opposition to the state taking greater control of local tax revenues and finances — even if it's the best strategy to break down municipal fiefdoms — because lawmakers have proven to be negligent stewards of appropriated funds. The business community perhaps has the greatest argument for legislative mis- trust after facing broken promises for years. As part of his two-year spending plan, for example, Gov. Dannel P. Malloy extended the corporation tax surcharge indefinitely — breaking a promise to sun- set it after two years — a move that osten- sibly increases Connecticut's corporate tax rate from 7.5 percent to 9 percent (now one of the highest rates in the country). Malloy's budget also places further restrictions on company's ability to use tax credits they've already earned. While Malloy refuses to call these moves tax increases, they are a slap in the face to busi- nesses that depend on stable rates and policies to adequately plan for the future. But uncertainty is what CT Inc. has come to expect from a state government that seems unable to get its fiscal house in order, or consistently promote a business friendly climate. Such a mindset isn't suitable in promoting long-term economic growth and opportunity. Regaining credibility in the minds of the electorate — particularly the business com- munity — won't be easy, but it can and must be done. If Connecticut is going to create a pro-growth environment, it will need key interest groups rowing in the same direction. There is some potential: Lawmakers, for example, are considering a legislative proposal that would create a transportation lock box, requiring all money raised for infrastructure investments to be used for transportation only. Such a measure would make businesses more comfortable in paying a bit more — possibly through tolls or other revenue-raising maneuvers — to rebuild Connecticut's dilapidated roads, bridges, and highways. That's a good start, but it will take more than simple legislative fiat for lawmakers to regain credibility. Talk is cheaper than action. n otHer VoiCeS Statewide car tax isn't reform but status quo By Chris Powell W hile they're calling it "reform," as they usually do, Democrats in the General Assembly are lining up behind another plan to increase taxes and thereby help relieve Governor Malloy of his campaign pledge last year not to do so. The idea has been around for years — transferring to state government the municipal property tax on motor vehicles so that all vehicles are taxed at the same rate rather than at rates that vary wildly among municipali- ties. But municipali- ties would not nec- essarily recover the taxes collected on the cars domiciled within them. Instead state government would send the money back to municipalities on the basis of what it considered their need. That is, money from municipalities with largely self-sufficient populations would be transferred to municipalities with largely dependent populations. Predictably enough, the bill has been proposed by state Senate President Pro Tem Martin Looney, Democrat from ever-impover- ished New Haven, while Sen. L. Scott Frantz, Republican from exclusive Greenwich, and Rep. Sam Belsito, Republican from almost- as-exclusive Tolland, denounce it as redistri- bution of wealth and socialism. But of course all government is to some extent redistributive and socialistic, taking money from people through taxes and giv- ing it to others, for good or ill. So unless the Republicans want social Darwinsim, their objection is silly, and sillier still because tax disparities like those arising from the prop- erty tax on cars are fairly questioned and because redistributing the car tax money will only make things worse. The bigger issue here is how much autonomy and responsibility municipal government is to have. This issue has been addressed repeat- edly for years in public education as state gov- ernment has increased its subsidies to munici- pal school systems and has imposed more requirements on them in a somewhat misguided pursuit of equalizing educational opportunity, school spending having little effect on educa- tion, as educational results correlate mainly with parental involvement with children. If it's unfair for the same car to be taxed at different rates in different municipalities, it's no fairer for similar residential or busi- ness properties to be taxed at different rates as well, especially since municipalities spend most of their property tax revenue on educa- tion, what with school systems supposed to be largely equal throughout the state, even though they never can be largely equal as long as their students are not. If Connecticut really believed this equality stuff, it would have a single statewide prop- erty tax rate (if it had a property tax at all); state government, not municipal gov- ernment, would run all public schools, as in Hawaii; all schools would have to have the same facilities and provide the same services, with no omissions or extras permitted; and municipal gov- ernment would stick to local roads main- tenance and senior citizen centers, at least until those things also were discovered to be constitutional rights. But fairness is not what Looney's legisla- tion is really about. Rather its objective is the same old Con- necticut Democratic objective — simply to raise taxes in self-supporting middle- and upper-class towns, which have populations still somewhat capable of holding municipal gov- ernment to account, disproportionately towns with Republican administrations, and to trans- fer the money to cities whose populations are impoverished, dependent on welfare stipends, and indifferent to civic responsibility. That is, to transfer the money to cities with Democratic administrations, laden with political patronage, incompetence, and corruption; cities that, like Hartford, can find tens of millions of dollars to build a minor-league baseball stadium but not to keep school buildings in ordinary repair; cities where policy for decades has been not to allevi- ate poverty but perpetuate it as a lucrative busi- ness for a sanctimonious elite. That's no "reform." It's the status quo. n Chris Powell is managing editor of the Journal Inquirer in Manchester. HartfordBuSineSS.Com Poll Would you use a nonstop flight to Dublin out of Bradley International? ● Yes ● No To vote, go online to HartfordBusiness.com. Last week's poll results: In five years, where are you most likely to gamble? 19.8% CT casinos 5.8% Mass./N.Y. casinos 19.8% CT off-track-betting parlor 54.7% I don't gamble Chris Powell ▶ ▶ A lack of trust in state lawmaker's ability to hold true to their promises has created an undercurrent of suspicion at the State Capitol that threatens to hold back Connecticut's ability to progress on many fronts. ▶ ▶ Money from municipalities with largely self-sufficient populations would be transferred to municipalities with largely dependent populations. Send Us Your Letters The Hartford Business Journal welcomes letters to the editor and guest commentaries for our opinion pages. Electronic submissions are preferred and welcome at: editor@HartfordBusiness.com. Or you may fax submissions to Editor, Hartford Business Journal, at (860) 570-2493.

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