Hartford Business Journal

8 Hartford Business Journal • March 19, 2018 • www.HartfordBusiness.com Reporter's Notebook Matt Pilon | mpilon@HartfordBusiness.com Health Care/Bioscience, Startups & Entrepreneurs, Government/Law and Energy GOVERNMENT & POLITICS CBIA CEO sees shared pain in commission's recommendations S hortly after the state Commission on Fiscal Stability and Economic Growth began holding public meetings, labor lead- ers accused the CEO-led group of having determined in advance what they intended to recommend to the legislature — most likely, a pro- business, anti-labor agenda. "We think the fix is already in," AFL-CIO Presi- dent Lori Pelletier said last month to the com- mission, co-chaired by former Webster Bank CEO James Smith and former Women's Health USA CEO Rob- ert Patricelli. Pelletier's remarks came not long after the Connecticut Business & Industry Association, which claims thou- sands of companies as members, released its 2018 legislative agenda. It included a quote from CBIA CEO Joseph Brennan that, depending on how you read it, seemed to suggest Brennan, who was not a commission member, was privy to some of the union reforms the commission intended to recommend several weeks later. "Although the report is not due for a few more weeks, we believe it will contain impor- tant reforms regarding collective bargaining, state pensions, and other factors that are driv- ing Connecticut's short- and long-term fiscal problems," Brennan said in the statement. Indeed, the commission did recommend curbing some state employee collective bargaining rights. Pelletier likes that the commission heeded her plea for a $15 minimum wage, but overall she as- sailed the report, calling it "a gift" to the CBIA and municipalities. In a recent interview, Brennan said that while he knows many of the commission members personally, and has dined with several, he's no puppet master. He said he regrets the exact wording of his statement — "believe" should have probably read "hope." "I had conversations with these (commission members) because I know them, but I'm not on the commission," Brennan said. "I testified publicly like everybody else." One surprising aspect of the commission's report is that business groups, CBIA included, have voiced major concerns about some recommendations. CBIA supports the recommended union bargaining changes, STEM education push, lower personal income tax rates and repeal of the estate and gift taxes. However, Brennan said his members dis- like the commission's call for a 0.8 percent payroll tax on employers with 100 or more work- ers, which would generate an estimated $475 million in annual tax revenues by 2020. (Compa- nies with 10 to 99 workers would pay a reduced payroll tax rate, while firms with fewer than 10 employees would be exempt.) Brennan says if that tax passed, it may cause some employers to reevaluate their headquar- ters location — like General Electric and Aetna both have done in the past two years. "You're not going to solve a problem as serious as we have without everybody feeling some pain," Brennan said. "So we expected that there would be some contributions asked for from the business community, but the reaction around the payroll tax was pretty significant." CBIA is also cool to the idea of a higher sales tax and minium wage, but has not weighed in yet on highway tolls. Brennan said CBIA wants to see a detailed proposal before it opines. ECONOMIC DEVELOPMENT Hartford region crafting new economic development strategy In Hartford, 2018 is turn- ing out to be a planning year. While the Commission on Fiscal Stability and Eco- nomic Growth has created a buzz at the state Capitol around Connecticut's path forward, several regional groups have begun to examine what strategies would best propel Greater Hart- ford's economy. The so-called Comprehensive Economic Devel- opment Strategy (CEDS), which in- volves the Metro- Hartford Alliance, 38-town Capitol Region Council of Governments (CRCOG), Hartford Foundation and others, is backed by federal dollars. The CEDS plans have been created every six years since the 1990s, said John Shemo, the MetroHartford Alliance's vice president of entrepreneurial ecosystems. Past strategy recommen- dations have included creat- ing: a dedicated busway (CT- fastrak); the Capital Region Development Authority and Hartford Parking Authority; the Hartford-to-Springfield rail service; a construction jobs program; and an intern- ship program that helped the MetroHartford Alliance conceive its now popular HYPE group for young pro- fessionals, Shemo said. "I think we've come miles and we've got miles to go," Shemo said. CRCOG President Lyle Wray said that while previous CEDS plans have had some influence, the 2018 plan aims to drive the largest possible impact for the region. "It's not going to just be a wish list of projects," Wray said. "This is not just 'here we go with another CEDS.' " CRCOG has a $175,000 budget for the effort, com- pared to $50,000 in 2012. The Alli- ance and Hartford Foundation kicked in some financial aid and the group recently hired Pittsburgh-based Fourth Economy as an economic consultant. Wray said Fourth Economy will help the regional partners — including an advisory com- mittee of busi- ness, education, government and nonprofit lead- ers — identify a handful of core strategies and figure out ways to stick with them over the next five to 20 years. "The problem is not a clever plan, it's what you do with the report," Wray said. One idea Wray supports, though it's not guaranteed to be in the final CEDS, is creating a large-scale ap- prenticeship program for high school students that would get them an indus- try credential for one of the state's key industries, including manufacturing. Wray said Colorado's "CareerWise" program could serve as a potential model. It received charitable corporate donations of $9.5 million and aims to serve 20,000 students within 10 years. Wray said he expects the CEDS plan to be complete be- fore the end of the year. STATE GOVERNMENT CT's debt and unfunded liabilities among highest in U.S. The CEO-led Commission on Fiscal Stability and Economic Growth recently unveiled its recommendations to overhaul the state's tax system, invest in infrastructure and promote economic development. In its final report, the 14-member group also had striking data (shown left) on the state's worrisome debt and unfunded liabilities overhang. Source: Moody's Investor Service John Shemo, Vice President of Entrepreneurial Ecosystems, MetroHartford Alliance Lyle Wray, President, Capitol Region Council of Governments (CRCOG) Connecticut Business & Industry Association CEO Joseph Brennan. PHOTO | HBJ FILE

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