Governor M. Jodi Rell is not alone in presenting a budget for the state this week.
Two Yale Law School students and a law school professor, in conjunction with the Better Choices for Connecticut Campaign, have presented an alternative budget for the state — one they say will not cut vital services to Connecticut’s neediest.
Rell is expected to release a budget today for the next two fiscal years that aims to close the state’s growing budget gap by cutting certain public services. In contrast, Yale Law students Jeffrey Tebbs LAW ’10 and Ady Barkan LAW ’10 and Professor Jay Pottenger LAW ’75 have developed a plan to balance the budget by doing the opposite: raising taxes.
While the budget that the law school team proposed Monday morning was based on a projected budget deficit $1.5 billion lower than a revised deficit estimate that was released Monday afternoon, the team maintained that their plan is fiscally sound.
Barkan, for instance, rejected the notion that funding for state-provided social services must be cut to ameliorate the state’s financial situation.
“The governor said the budget could not be balanced without cutting services,” Barkan said. “We proved her wrong.”
Tebbs added that the governor’s move to take revenue options off the table in the midst of the largest deficit in recent history was irresponsible.
“Slashing services across the board is unconscionable,” he said.
The law school team’s plan would raise up to $1.2 billion from reformed corporate tax rules, an increased sales tax and increased taxes on, as the proposal put it, “those who can best afford it.”
Doug Hall, the acting managing director of Connecticut Voices for Children, referenced the perennial debate over those who believe a tax on a state’s top wage earners is the best way to eliminate a deficit, and those who do not.
“If you take a look at the work of Nobel-winning economists, they say placing taxes on those at the highest end is the most efficient way to close a budget gap,” he said.
But in an address to state residents Monday, Rell explained why she would not seek tax increases.
“One thing you cannot afford is a higher tax bill,” she said. “After all, it makes no sense to raise taxes when the taxes we already collect are down — way down. Income tax revenue is down. Sales tax revenue is down. Corporate tax revenue is down.”
Hall said he was concerned the governor was neglecting an important function of state government in times of crisis — stimulating the economy.
“What disturbed me most [about her address] was her comparison to running the state like you would run your family budget,” he said. “During tough economic times it is incumbent on government to use the tools at its disposal to turn around the economic times. The priority of the state has to be to stimulate the economy, not cut the budget.”
Some state leaders are perturbed by the notion of raising taxes by such extreme measures.
“The key word with the budget is ‘balance,’ ” Lt. Governor Michael Fedele said in a telephone interview Tuesday. “There are individuals on both sides who are presenting imbalanced proposals. We need to ensure that when we do come out of this — and we will come out of this — we are stronger for it.”
In an interview with the News on Monday, gubernatorial candidate and former speaker of the state House of Representatives James Amann criticized sales tax proposals, saying that if anything, the sales tax should be reduced to promote shopping. He is a proponent of consolidating now-separate municipal services so as to streamline operations and cut costs.
Barkan defended the sales tax increase, claiming that a 1 percent increase will not prevent shoppers from buying.
“People are not buying because they lost their job, had their housing subsidy cut or are out of money at the end of the month,” he said. “One penny on the dollar doesn’t mean much in comparison to that.”
Tebbs, Barkan and Hall say legislators are warming up to their budget proposal, which they likened to an “opening bet,” an initial offer in negotiations.
“Our proposal will hopefully create political space for the Democrats in the legislature to seriously discuss ways to raise revenue,” Tebbs said.
Governor Rell’s budget will be released in an address to the General Assembly at noon today.