Faced with a budget deficit of $3.5 billion over the next two years, and three months overdue on a budget for fiscal years 2018 and 2019, Connecticut lawmakers face a difficult situation and must make tough choices.  In 2011 and 2015, the legislature tried to solve the state’s fiscal woes by passing big tax increases.  That’s why a vote in the wee hours of Saturday, September 16 is so important: a bipartisan coalition of lawmakers defied the threats of Gov. Dannel Malloy (D-Conn.) and the state’s House and Senate leadership and passed a budget plan that does not increase taxes and begins to make needed reforms to the state’s big-spending culture.  Despite Gov. Malloy’s veto threat, the actions taken by these legislators may represent a turning point for Connecticut.

The plan passed by both houses of the legislature eliminates unnecessary state agencies and consolidates others, cuts funding to wasteful university projects, and ensures the long-term stability of Connecticut’s underfunded public sector pension program by requiring state employees to contribute more robustly to their retirement plans when the existing state union deal expires in 2027. 

The passage of this budget is even greater an achievement, given what would have happened if Gov. Malloy and legislative leadership had their way.  Their proposal contained a package of tax and fee increases that would have further damaged the state’s economic competitiveness by driving businesses and jobs way.  Taxes would have been increased on cell phone bills, ride-sharing services like Uber and Lyft, hotels, hospitals, vacation homes, fantasy sports betting, tobacco products, and more.  For example, an employee who uses Uber to get to and from work each day would have paid an additional $130 in taxes.  A family of four would have paid $24 more each year on their wireless bill.  Visitors who stayed in Connecticut hotels would have seen an increase of more than 11 percent in the tax they pay.  Seniors on fixed incomes would have experienced a pronounced decrease in their purchasing power.  These increases in taxes and fees would have been painful for Connecticut residents who already suffer under one of the highest tax burdens in the nation, second only to New York.

Gov. Malloy has said he will veto this commonsense budget, but the big spending, business-as-usual politicians may have finally seen a defeat after years of destructive tax and spending increases.  For this, taxpayers should be thankful.