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Governor Malloy gives annual State of the State address focusing on budget deficit

HARTFORD — Governor Dannel Malloy delivered the 2017 State of the State address on Wednesday. His main focus was on the state budget, which has roughly a $1.3 billion deficit.

He began by acknowledging the deaths of Reps. Mary Fritz and Betty Boukus, who both passed in 2016.

Turning to business, Malloy focused on the budget. He praised the state’s partnerships with Sikorsky Aircraft, United Technologies, and Electric Boat.

“Taken together, these agreements cement our leadership in advanced manufacturing around the globe,” Malloy said.

Connecticut’s budget is the top issue for the new legislative session which began as they returned Wednesday for a new legislative session. The Governor outlined three areas that he believes need to be addressed in order to achieve a balanced budget:

  • Continued cost savings and efficiency in state government
  • Changes that will make the state pension and benefits more affordable
  • Creating a more fair and equitable system for town aid, one that guarantees equal access to a quality education for all children

“Last year we cut nearly $850 million to bring our current fiscal year in balance,” he said, addressing the first item.  “In so doing, we spent less in the General Fund than we had in the previous year for the first time since 2002. We’ve reduced the number of state agencies by 28 percent since 2011 — shrinking from 81 agencies down to 58.”

In his second major point, Malloy laid out some major frustrations for Connecticut residents.

“Of the $1.65 billion that we will pay next year into the state retirement systems, 78 percent of that – or nearly $1.3 billion – is what we’re paying to make-up for what past administrations and past legislatures failed to do,” he said. “Simply put, our generation is paying for Connecticut’s past mistakes. Is it frustrating to do that?  Of course.  Is it necessary?  Absolutely.”

The third area Malloy focused on is how the state distributes aid to cities and towns – and how we fund public education.

“The state provides a total of $5.1 billion in municipal assistance,” he said.  “That’s more than one fifth of our overall budget this year, making it our biggest single expense – not state employee pensions, not Medicaid, not debt service, not salary and benefits of our employees; town aid accounts for the largest portion of our state budget.”

He promised the budget he will present next month will outline a “more equitable system” for providing town aid.  “It will be based on the local property tax burden, student need, and current enrollment,” he said.

Malloy then touted some of the state’s transportation accomplishments, including the CTfastrak system and the completion of the Q-Bridge project. He also praised his controversial prison reforms.

He also took a moment to comment on the 2016 presidential election. The statement below received the longest applause of the speech:

“It is now more clear than ever that too many Americans feel disconnected from their government.  They feel the system isn’t working for them – that they aren’t able to take part in the American Dream. While we might disagree on the role of government in that effort, on whether it should be more active or less, I offer to you that a greater degree of predictability in government – in all government, at all levels – will help reengage and reinvigorate our democracy… Regardless of your party or who you voted for, most of us can agree that this presidential transition has been nothing if not unpredictable.  It has left some people and some communities feeling anxious and uncertain. But let me remind you of this – our state has a long legacy of acceptance, compassion, and fairness.  Regardless of whether your family settled in Connecticut 300 years ago or three days ago, you are welcome here.”

The fiscal year beginning July 1 is projected to have a roughly $1.3 billion deficit in the state’s main spending account, which is typically about $18 billion.

Malloy isn’t expected to unveil his new, two-year budget proposal until February, he’s already asked state agency heads to come up with ways to further reduce their budgets. He and lawmakers are also expected to try to make Connecticut’s business climate more competitive.

Legislators face a host of other issues. The list includes possible action on a proposed, third tribal casino and legislation allowing Connecticut to pool Electoral College votes with other states.