Budget negotiations between Republican Gov. M. Jodi Rell’s office and General Assembly leaders are expected to begin today, the latest step in what is becoming an increasingly contentious debate.
Democrats and Republicans agree that the state needs to cut wasteful government spending by consolidating agencies and scaling back services. But when state leaders meet, they will need to iron out not only how to close the state’s record budget deficit, but the exact size of that deficit as well.
Having based their predictions off of dueling reports from the Office of Fiscal Analysis and Office of Policy and Management, Rell and the Democratic leadership are currently over $1 billion apart on the size of the gap. Additionally, they need to reach an agreement on whether to raise taxes for the coming two fiscal years.
To help alleviate the state’s budget gap, Democrats are proposing a more progressive income tax, raising taxes significantly on those earning more than $250,000 annually. But Rell has said she would not approve any tax increases in the budget, though she has said she would be willing to raise fees on various state services and licenses, such as vehicle registrations and liquor license applications.
Republicans in the General Assembly released a budget of their own last week, proposing to close the budget gap without raising taxes. But Republicans represent a small percentage of the General Assembly.
Democrats hold veto-proof majorities in both the State Senate and the House of Representatives. And historically, issues of taxation stress the bonds of political unity.
State leaders hope to have a final budget passed before the end of the General Assembly’s session this year, scheduled to adjourn on June 3.