Suddenly faced with a projected $700 million budget gap that was created last week, Gov. Dannel P. Malloy wants to privatize services, decrease the earned income tax credit, freeze controversial "longevity payments'' for state employees, and cut the number of accrued sick days for state employees in Thursday's special legislative session.
Malloy is trying to close the gap before the fast-approaching fiscal year that starts Friday, even though Connecticut and other states have routinely blown through the new fiscal year without a new budget. In Connecticut's case, the legislature already approved a budget for the next fiscal year, but Malloy wants changes because the rank-and-file state employees rejected a concessions deal that was crafted by their union leaders.
The changes include decreasing the state's new earned income tax credit from 30 to 25 percent for a savings of $18 million, according to a telephone conference between Malloy and newspaper editors around the state. The tax credit had been created by Malloy and the legislature, but the switch to 25 percent would go back to January 1.
On the labor front after concessions were turned down by SEBAC, Malloy will be trying to decrease the number of accrued sick days from 15 to 10 per year as union contracts expire.
Malloy is also seeking extraordinary budget-cutting powers for the next two years, which Republicans say is far beyond anything that any previous governor had. If the legislature doesn't give him the latitude he wants, Malloy said, "Then (they) can summer here, talking to lobbyists about what they do and don't want in the budget."
Malloy wants the ability to cut "10 percent of any fund or $45 million of any particular line item,'' according to a summary of legislation by the governor's budget office for Thursday's special session. He also wants "greater flexibility to move funds in a timely fashion between line items within agency budgets to address adjustments in resource needs caused by reductions in staff resources and/or shifting demand for services,'' according to the summary. "This will also permit the governor the necessary flexibility in the event of such reorganization to close agency locations and transfer those resources.''