State lawmakers are being briefed over the next few days on details of a tentative bipartisan state budget plan, with a vote possible sometime next week. Lawmakers have been at odds over how to balance a roughly two-year budget that's projected to be $3.5 billion in deficit.
Brookfield Representative Steve Harding says municipalities haven't been able to plan for next year, because they've been focused on the current year. He acknowledged that changes to the education cost sharing formula are needed, but opposed the deep cuts and funding eliminations in Governor Malloy's executive order.
Lawmakers and staff confirmed the following highlights of proposal, stressing they could still change.
- Property taxes on vehicles: The state would continue capping the tax rate that cities and towns can charge on vehicles in local property taxes in the first year of the two-year budget and then entirely scrap the tax in the second year. Lawmakers have not yet decided how to make up the lost revenue to cities and towns, but stressed they would be somehow compensated.
Betsy Gara, executive director of the Connecticut Council of Small Towns, said her organization worries the proposal "will simply shift more of the property tax burden to homeowners and businesses, discouraging investment in real estate and undermining our local economies."
- Taxes: Connecticut's cigarette tax would increase by 45 cents in the first year, to a total of $4.35 a pack. Currently, the budget package does not include higher income taxes or sales taxes. Earlier ideas, such as a proposed state property tax on seasonal homes, a 25-cent fee on ride-hailing services and a cellphone surcharge are not part of the tentative agreement.
As it stands, the plan would limit the state's $200 property tax credit against the personal income tax to only seniors and people with dependent children.
- Teacher pension: The blueprint does not shift the cost of funding the state teacher pension plan to cities and towns, as proposed by Malloy. However, it requires teachers to contribute 1 percent more of their income to the fund starting in January 2018. They currently pay 6 percent. The compromise maintains a 25 percent personal income tax exemption for teacher retirement pay. The state's largest teacher union, the Connecticut Education Association, opposes the proposal, calling it tax increase.