TAXES: A lethal weapon used by the
government which is killing the finances and stability of American families throughout
the country - especially in Connecticut
where we are Taxed to the Max!
The ultimate question relating to Malloy’s latest budget is: Will
it pass the smell test of the Rating agencies?
Or is a downgrade in our future?
February 6, 2013
From: The Federation of
Connecticut Taxpayer Organizations
Contact: Susan Kniep,
President
Website: http://ctact.org/
Email: fctopresident@aol.com
Telephone: 860-841-8032
Governor Malloy produced a budget
today which he is spinning as a cure all for the fiscal ills which plague our
state. But as a spinning top ultimately
falls, so will Connecticut towns as he removes their ability to generate
revenue through a tax on cars while no other revenue source, eliminates State
funding such as Payment in Lieu of Taxes, referred to as Pilot Funding, and
refuses to reform Collective Bargaining Laws and other state mandates as approximately
85% of local property taxes fund personnel related expenses.
As Towns lose revenue under his
budget, local Boards of Education will gain.
It is however those financial gains which could cripple towns and local
taxpayers in the future if they are forced to sustain the State’s established
funding levels for Education through
property tax increases.
The end result could be towns
ultimately falling to bankruptcy, with limited revenue, while being forced to
meet the demands of union contracts which contain unsustainable wages, pensions
and healthcare costs.
Click the following to determine
what your town will receive and read an extension of our comments below.
CONNECTICUT
FY 2014 – FY 2015 BIENNIUM
GOVERNOR’S BUDGET
Proposed Appropriations -
Excel Format
BUDGET HIGHLIGHTS
BUDGET SUMMARY
BUDGET-IN-DETAIL
After imposing $1.5 billion in new taxes in 2011,
the largest state tax increase in history, Governor Malloy and the Democrat
controlled state legislature went on a spending spree which they are continuing
under this year’s budget released on February 6.
During 2012, we learned the State committed
millions of taxpayer dollars to speculative business ventures in the name of
job creation. Their plan however was flawed as they lacked money to support
these deals. Their
solution? Borrowing! And adding
to the State’s bonded debt which is now the highest per capita in the nation as
our debt exceeds $61 billion.
With the release of the Governor’s latest budget, there will
be more deficits and debt – much more! Not only for the State but local municipalities, as well. The $560 million raised by communities in
property taxes on automobiles assessed at under $20,000 - Gone. The $74 million awarded by the State for
Pilot (Payment In Lieu of Taxes) Funding - Gone.
A portion of this money could be received by a Town in another format
but with the caveat that it be used as the State dictates as opposed to a
town’s general fund. Towns who counted
on this money will have to look for it elsewhere which could mean increases in
property taxes, cuts in services and layoffs.
The Governor’s latest two year budget totaling $43.8 billion
increases spending nearly 10%, relies on additional bonding to close a $1.2
billion deficit, forces municipalities to make up for the millions now
collected in property taxes on automobiles assessed under $20,000 which will become
exempt, as well as millions of dollars in Pilot Funding, and the delayed
repayment of $1 billion until 2018 which was initially borrowed under former
Gov Rell to balance her budget.
The most egregious of the Governor’s budget is that he will
exceed the spending cap, ignore the law, and rewrite it to bring himself into
compliance.
The 45,000 State employees are secure in their jobs and it
is apparent will receive the 9% wage increase committed to under their current
contract.
Of course, jobs in the private sector could be at risk as
the Governor refuses to sunset the tax on power plants and a corporate tax
which were due to expire during the next fiscal year
And the most problematic for the Governor is the
implementation of GAAP Accounting.
According to CTMirror.org “If GAAP standards are used, state finances
are $1.5 billion in the red, though Comptroller Kevin Lembo
says that number will be down to $1.2 billion by the end of this fiscal year.
“The legislature and Malloy had planned to whittle that number down over the
next 15 years with annual payments of between $80 million and $100 million.
“Instead, the governor wants to borrow $750 million. This will reduce the
annual payment the state must make to a more-manageable $30 million. But it
also would mean another $186 million in interest charges.”
The ultimate question relating to Malloy’s latest budget is
– Will it pass the smell test of the Rating agencies? Or is a downgrade in our future?