In today's email:
- A bill on business tax transparency moves forward
- Connecticut’s dismal state budget
- Equitable access to early care and education forum
Good News! Business Tax Breaks Oversight Bill Moves Forward
Amidst the worsening state budget, we’re happy to report some good news. H.B. 7316, a bill that seeks to improve transparency and oversight of business tax breaks was voted unanimously out of the Finance Committee last week. The bipartisan bill would require evaluation of all business assistance and incentive programs and require public hearings to discuss the results of the evaluations.
We at CT Voices have called on lawmakers to address the systemic challenges in our revenue systems, including our corporate income tax system. Ensuring that business tax breaks receive the same scrutiny as spending on education, health care, and other building blocks to a healthy economy is a step in the right direction.
ICYMI: Our recent report estimated that Connecticut will hand out $707 million in business tax breaks this fiscal year (FY 2017). From FY 2016 to FY 2017, the cost of business tax breaks (in absolute dollars) increased by $12 million while spending on children (as defined by our Children’s Budget) decreased by $81.2 million.
News: Connecticut’s Dismal State Budget
Last week, the Appropriations Committee, Finance Committee, and Republican Party presented their budget proposals. Following today’s consensus revenue estimate, all proposals are out of balance by nearly $1.5 billion. According to the estimates, the newly-projected budget deficit is now $2.2 billion for FY 2018 and $2.7 billion in FY 2019.
Connecticut’s financial woes are the result of years of mismanagement: the state put state workers’ pensions on its credit card for decades, and ignored changes in the economy (such as the shift to services and its impact on the sales tax) that eroded its tax collections. Economic development policies have focused on one-off deals instead of working to revitalize our cities and attract new jobs, young professionals, and entrepreneurs. Above all, we have neglected the need to build a strong foundation for children and families based on education, workforce development, infrastructure, and investments in our cities to ensure equitable economic growth.
We need a balanced, long-term approach – and this will entail adopting bold reforms that look both at the spending and the revenue side of the budget. We need new strategies for growth, better strategies to target spending, and new revenue sources so we can address the state’s priorities and provide equitable opportunity for all in the state. If we stay the course, do not look at real reforms, and try to close the gap just with spending cuts, Connecticut will put its long-term prosperity at risk.
Stay tuned for a more detailed analysis/response to the budget proposals.
Other news: Bills of Interest
Some updates on some of the bills we have been tracking this session:
- S.B. 894: this bill would create a Child Welfare Oversight Council for children under the care of the Department of Children and Families. It moved out of committee and is awaiting a vote in the Senate. You can read our testimony here.
- H.B. 7286, S.B. 1025: these bills will create the structures to coordinate services and supports to help divert youth from juvenile justice involvement. These services are needed so that the Juvenile Training School can be closed and youth can be served within their communities or, when necessary, evidence-based small residences. They are awaiting votes in the House and Senate. You can read our testimony here.
- H.B.7270, H.B. 7255: a couple of study bills focused on special education funding and the Education Cost Sharing Formula. Both of them are waiting action in the House; you can read our testimony here and here.
Event: Equitable Access to Early Care and Education Forum
The Commission on Women, Children and Seniors and the Office of Early Childhood are hosting a discussion on equity and access to early childhood this Thursday, May 4, from 1:00 PM to 3:00 PM at the Legislative Office Building (300 Capitol Avenue, Hartford, Room 1D). The event will focus around the new policy report, “Cradle to Kindergarten: A new Plan to Combat Inequality.” Hear from the two authors, Ajay Chaudry and Chistina Wiland, who will lead the conversation and introduce their recommendations.
What We Are Reading/ Listening to
- Governor Malloy’s interview in Where We Live.
- Escaping Poverty Requires Almost 20 Years With Nearly Nothing Going Wrong, The Atlantic.
- To Help Tackle Inequality, Remember the Advantages You’ve Had, The Upshot, New York Times.
- State and Local Governments Face Six Significant Issues with the Trump Tax Cut Outline, Rockefeller Institute of Government.
- Life in College After a Life in Foster Care, New York Times.
- The Cost of Segregation, Metropolitan Planning Council.
- When Restrictions on House-Building Meet Growing Demand: Interview with Joseph Gyorko, Conversable Economist.
- Constitutional Revenue Limits Can Impede State Economies, Center for Budget and Policy Priorities.