HARTFORD -- When Dan Malloy is sworn into office Wednesday as Connecticut's 88th governor, it will mark the first time a Democrat has held the governor's office in 20 years -- and the first time one has succeeded a Republican since Gov. Ella Grasso in 1975.
With the Democratic Party out of power for so long, more than 1,700 revelers will celebrate those accomplishments at a sold-out inaugural ball Wednesday night at the Connecticut Convention Center.
But when that celebration subsides Thursday morning, Malloy will be facing the sobering reality of a cash-strapped state with a projected budget deficit of $3.5 billion in the next fiscal year - a large percentage of a $19 billion annual budget. The state has completely drained its "rainy day'' fund and spent all of its federal stimulus money. to close the budget gaps over the past two years
Based on Malloy's statements during and after the campaign, many expect the new governor to propose both tax increases and spending cuts. He describes Connecticut's looming budget gap as the largest per capita deficit of all 50 states and has already been preparing Connecticut residents for the major difficulties ahead.
"This is the tsunami. This is the crisis. This is the equivalent of the Great Depression, if you will, or the great war,'' Malloy said in a detailed interview recently with The Courant. "That's what this is.''
Malloy has repeatedly called for "shared sacrifice,'' which some interpret to mean as tax increases for all. Malloy, though, has declined to say precisely which taxes he might raise.
"We don't have the specifics of what shared sacrifice will look like,'' Malloy said. "There was a reason I never took a no-tax pledge because that was political rhetoric at its very core, and I knew there wasn't assistance coming from Washington.''
While the final details are not expected until his proposed budget is released Feb. 16, Malloy is considering removing the huge series of sales-tax exemptions that have fallen into the state's tax code through the years. That could mean that the state would start charging sales tax on boat repairs, haircuts, car washes, and newspapers, among other goods and services.
"Some of them on their face just don't appear to create jobs,'' Malloy said. "We are, in fact, examining all of those, and I think this is the appropriate time to do that.''