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Home
October 26, 2012

October 26, 2012 

 

 

From:  The Federation of Connecticut Taxpayer Organizations
Contact:  Susan Kniep, President
Website:
http://ctact.org/
Email:
fctopresident@aol.com
Telephone: 860-841-803

 

Hurricane Sandy A Growing Threat To Connecticut

 

CL&P Launches Emergency Plan, Calls For 2700 Midwest

 

 

Sign Up for:  Connecticut Emergency Alerting and Notification Systems

 

 

 

Consumer sentiment at highest in five years in October

 

 

 

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TAXPAYER BRAGGING RIGHTS!  The Federation congratulates FCTO Board Member, Jim Louziotis, and all members of the taxpayer group, Lower Our Taxes – LOT –to include Barbara and Larry Hample in their efforts to put the New London budget on the Ballot giving taxpayers a voice in the budget process.  Although New London city officials appear eager to thwart their efforts as  described in the article captioned Taxpayers start budget battle with city | WTNH.com Connecticut   we know LOT will work, as they always do, in the best interest of the taxpayers of New London.   Anyone wishing to speak to Jim or Larry and Barbara can reach them at 860-443-1144 or 860-443-2919.  

 

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Is Property Tax Hike on the Horizon?  As the State focuses on bankrolling businesses  Connecticut Taxpayers are Already Taxed to the Max as the Summary of State Revenues by Fund, Tax Type and Account for Fiscal Years 2007 through 2012 illustrates as prepared by Robert Young, Secretary,  of the Federation of Connecticut Taxpayer Organizations.  

 

For months, the Federation has been alerting Connecticut taxpayers to what we perceive to be the unrestrained spending by the Governor and our State legislature which could ultimately lead to a reduction in State aid to municipalities and in turn, local property tax increases on homeowners and businesses.  A recent headline has now confirmed our suspicions as Malloy 'can't make any promises' about town aid in next budget. 

 

As Congress stands on the edge of the Fiscal Cliff staring into the abyss of budget cuts and looming tax increases, the State of Connecticut appears to have taken the plunge over the cliff. Christine Stuart recently reported CT News Junkie | Deficit Up To $60.1M noting that “The state is just four months into the fiscal year and it’s $60.1 million in the red, according to Office of Policy and Management Secretary Ben Barnes.  “In his monthly letter to state Comptroller Kevin Lembo, Barnes noted the deficit increased $33.2 million from last month’s estimated $26.9 million deficit. “This change is due to weaker revenue collections.” 

 

As the GOP says growing state budget hole must be recognized now -- not after the election. the Federation would agree as the State prepares to fund a 9% wage increase over three years for State employees under a no layoff clause which could result – if the Governor runs out of money during the life of the contract – a cut to municipal aid and in turn an increase in property taxes as  TAXPAYERS PAID OVER 5.7 BILLION DLRS FOR STATE OF CONNECTICUT HEALTHCARE COSTS IN 2012 . 

 

Recently,  the Connecticut Conference of Municipalities (CCM) released a report as highlighted by CTNewsJunkie.com in their article captioned Municipal Lobby Shines Light On Property Taxes, Gears Up For Legislative Debate and CTMirror.org in their article Communities still feeling the property tax bite, municipal lobby says.  Therein, CCM notes that “Connecticut's 169 cities and towns, along with their boroughs, fire districts and other political subdivisions, levied about $8.7 billion in property taxes in 2009-10, the last fiscal year for which CCM has complete records, Finley said, adding that the total, once updated, likely would clear $9 billion for the current year.   “Property taxes provide about 72 percent of the revenue for municipalities, while state aid -- which stands at about $3 billion -- represents 24 percent, according to CCM.”  You may find it interesting to Compare the Mill Rate in Your Town With Other Towns . 

 

Within a Municipal Lobbying Group Addresses Escalating Property Taxes , the Federation Offers Suggestions on How Town Leaders Can Work to Reduce Property Taxes recognizing that the Elephant in the Room which many are ignoring as it relates to the issue of escalating property taxes are State Collective Bargaining and Binding Arbitration Laws which have put public sector unions in control of cost drivers such wages, health care, pensions and management related issues.  Personnel related costs account for approximately 80% to 90% of Municipal and Board of Education budgets throughout the State.  These costs are determined by arbiters if union contracts cannot be settled between management and labor.  In addition, Past Practice has been upheld by arbiters if a benefit to the employee has continued without interruption even if the benefit is not referenced within their union contract. Example: The right of union members to drive town-owned vehicles home versus a Town Manager or Mayor attempting to end the practice due to budget constraints.   Arbiters have ruled that current union members can continue the practice while proposing the practice cease for new hires 

 

 Another question to ponder is – Is there Too Cozy a Relationship Between the Governor, the State Legislature and the State Employee Unions  as Healthbridge Sues alleging… “the pattern of actions by SEIU, including enlisting politicians and liberal activists in efforts to shame the company into a more generous stance toward its workers, are criminal extortion under the RICO Act, a federal law often invoked in cases of organized crime and racketeering. "This action is not about strikes or union organizing or collective bargaining," the suit says. "It is about a corporate campaign, endorsed and effectuated by Defendants and facilitated by the politicians they support, that is in its essence a shake-down by a lawless enterprise."  SEIU is the Service Employees International Union

 

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Recognizing that Connecticut Taxpayers are Taxed to the Max, Robert Young, ryoung0@snet.net, Secretary of the Federation of Connecticut Taxpayer Organizations,  sought the data and compiled the following information which is a

 

Summary of State Revenues by Fund, Tax Type and Account for Fiscal Years 2007 through 2012.

 

STATE REVENUES

FY 2007-2008

FY 2008-2009

FY 2009-2010

FY 2010-2011

FY 2011-2012

Personal Income Tax

7,512,688,284

6,385,856,437

6,586,098,745

7,246,431,257

8,310,820,450

Sales and Use Tax

3,582,316,852

3,318,752,207

3,203,987,561

3,353,230,300

3,830,116,804

Electric Generation

0

0

0

 

69,532,719

Corporate Tax

733,941,984

615,920,501

667,132,486

794,472,509

716,521,891

Public Service Corp. Tax

237,112,562

268,494,765

267,945,828

269,805,902

250,396,580

Inheritance & Estate Tax

170,618,814

238,336,664

177,600,970

237,573,241

191,699,581

Insurance Co. Tax

227,220,954

202,217,264

226,549,565

220,625,695

237,608,648

Cigarette Tax

335,196,665

317,774,453

387,435,034

499,415,134

421,004,824

Real Estate Tax

158,544,197

90,802,186

100,267,099

94,822,047

107,530,821

Petroleum Co. Tax

333,283,240

246,313,157

264,917,723

334,462,843

372,966,634

Alcoholic Beverage Tax

47,077,475

47,064,448

48,196,427

48,922,851

60,595,455

Amusement Tax

37,276,886

36,040,020

34,379,169

34,455,618

34,398,531

Miscellaneous Tax

139,979,799

143,304,958

138,999,907

140,505,449

536,809,665

Refund of Tax

-859,183,335

-1,058,371,073

-1,068,748,229

-962,822,962

-1,105,171,071

R & D Credit Exchange

-11,362,507

-8,428,079

-8,936,648

-8,598,487

-87,108,122

Transfer Special Revenue

287,603,607

287,195,243

289,313,774

293,107,879

313,756,643

Casino Gaming Payments

411,409,920

377,804,963

384,247,532

359,581,533

344,645,419

Licenses, Permits & Fees

323,434,156

305,128,457

389,364,403

385,895,265

419,988,634

Sales Commodities & Services

30,066,553

32,535,999

33,694,170

35,505,586

35,004,915

Rents, Fines & Escheats

59,117,352

63,760,344

252,960,611

157,771,166

123,498,056

Investment Income

100,498,044

34,388,995

10,743,532

5,535,251

3,172,408

Miscellaneous Revenue

139,381,059

164,987,569

154,313,182

178,727,489

199,280,334

Refund of Payments

-3,220,301

-3,096,151

-4,094,725

-4,879,446

-4,810,343

Federal Grants

2,698,396,710

3,622,963,146

4,047,622,239

4,244,537,539

3,607,458,837

Transfers from Others

115,300,000

115,800,000

102,898,482

116,015,139

96,100,000

Transfers to Others

-92,800,000

-92,800,000

-68,300,000

-68,300,000

-68,300,000

Unknown

812,102

5,146

2,928,071

0

72,485

Motor Fuels Tax

492,122,768

492,024,644

503,635,414

483,526,139

492,794,802

Motor Vehicle Receipts

225,524,482

220,780,734

220,703,127

220,144,426

235,446,219

Motor Vehicle Sales Tax

64,863,384

57,133,714

67,784,155

71,942,605

69,611,485

Grand Total Revenue $$$$

17,497,221,706

16,522,690,713

17,413,639,605

18,782,411,970

19,815,443,305

 

 

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Connecticut has also made the news within the article Nine States with Sinking Pensions.  Therein, Connecticut is ranked number 3 as the author notes

> Pct. liability funded: 53%
> Total liability: $44.8 billion (22nd largest)
> Total funded: $23.8 billion (24th smallest)
> S&P credit rating: AA

 

Connecticut has fallen short of paying its full annual pension payout three times between 2005 and 2010, and just over half of its liabilities were funded. In 2011, state unions agreed to concessions worth $1.6 billion, including changes to pensions , to avoid widespread layoffs. Some of the concession the unions agreed to, among others, were raising the retirement age by three years for those who retire after 2017 and increasing the penalty for employees who retire early. Despite the changes, Moody’s Investor Services downgraded the state’s credit rating from Aa3 to Aa2. The downgrade was partially due to unsustainably high retirement costs and “pension funded ratios that are among the lowest in the country.”

 

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of the Courant reported that the Higher-Ed Chief Reaped $100,000+ In Compensation Above $340,000 Salary  noting that “Robert Kennedy, the higher education chief who resigned Oct. 12 amid an uproar over $250,000 in unauthorized raises given to his subordinates, received at least $100,000 more than his widely reported $340,000 annual salary in 13 months on the job — including $75,000 from a contractual bonus and an unvouchered expense account. “What's more, the now-departed appointee of Democratic Gov. Dannel P. Malloy is still eligible for an additional $20,000 in "deferred compensation" — even after he's gone. “And although there was criticism over Kennedy's 8½-week absence from Connecticut during the summer, he's still expected to be paid more than $4,000 for 26.67 hours of "accrued vacation."  Read more at http://www.courant.com/news/politics/hc-lender-column-kennedy-contract-20121019,0,7871279.column

 

Yesterday, CTMirror.org reported Higher education board gives new president same pay -- minus expensive perks -- as ousted chief

noting that “Former University of Connecticut President Philip E. Austin will earn the same $340,000 annual salary as his predecessor -- but none of the additional lucrative incentives -- in exchange for leading the state's embattled, merged public college system on a temporary basis. “Besides authorizing Austin's compensation package, the Board of Regents for Higher Education also voted Thursday to reinstate two controversial pay hikes for two top executives. “A board sub-panel recommended the move, arguing these increases -- unlike 19 others -- actually were stipends properly authorized by the full board to reflect significantly increased responsibilities.” Read more at http://www.ctmirror.org/story/17898/higher-education-board-gives-new-president-same-pay-minus-expensive-perks-ousted-chief

 

 

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Economists see tax hike as twice the problem for growth than spending cuts

 

By Pete Kasperowicz - 10/26/12 06:00 AM ET  Economists appear to be in broad agreement that the possibility of ending the Bush-era tax levels next year would have about twice the impact on economic growth as the automatic cuts to government spending under the sequester. An informal survey of economists shows that they see increased marginal income tax rates as causing up to 40 percent of the slowdown in economic growth if the United States were to "jump off" the so-called fiscal cliff. In contrast, they attribute about 20 percent of the slowdown to reductions in government spending. This assessment mostly reflects the amount of money the higher taxes would take out of the economy compared to the lower spending. Returning marginal income tax rates to where they were in the Clinton administration would take a bit more than $200 billion out of the private sector, while the sequester would require a cut of about $100 billion in 2013 government spending. The reality of these numbers is already putting pressure on Republicans and Democrats — which have both promised to focus on economic growth — to reach some agreement on taxes before the end of this year.  Continued at ….. http://64.147.104.30/blogs/floor-action/house/264135-economists-see-tax-hike-as-twice-the-problem-for-growth-than-spending-cuts

 

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New Report Finds CT Spending Less On Education, More On Employee Health Care

by Christine Stuart | Oct 25, 2012 9:30am   CTNewsJunkie.com The state’s spending over the past two decades has shifted away from education and social services to debt service and state employee health insurance, a report released Thursday found. Human services, which accounts for one of the largest portions of the state budget, dropped 33.4 percent to 30.9 percent over the past two decades, while Medicaid spending has increased. However, the state spent 27 percent less per Medicaid enrollee in the last 10 years than it did a decade previous . Conversely from 1992 to 2012, retired state employee health care spending increased 239.1 percent and general fund debt service increased 50.3 percent. “As a consequence of fiscal pressures and budget decisions over the past two decades, the state’s debt has more than doubled in inflation-adjusted dollars, increasing by 142 percent,” the report concludes.   Continued at …… http://www.ctnewsjunkie.com/ctnj.php/archives/entry/new_report_finds_ct_spending_less_on_education_more_on_employee_health_care/

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OP-ED | Regent-gate Taints Malloy: Will Voters Remember?

by Terry D. Cowgill Posted: Oct 19, 2012 5:30am Unless his second two years are as daunting as the first two, Gov. Dannel P. Malloy is one lucky man. Then again, maybe not.  Since his swearing in, Malloy has accomplished a lot of unpleasant tasks (e.g. defusing a budget crisis, a record tax increase, intemperate remarks about teachers and givebacks from state labor unions) that ticked off a lot of his natural allies. And as I wrote in this space late last year, if the governor wants to run for re-election in 2014, Connecticut’s wretched economy will likely have improved by then and Malloy will have gotten most of the ugly obstacles out of the way early in his first term, leaving those he offended with ample time to forget. But I might have spoken too soon. Now add this one to the list of Malloy challenges: two senior executives of the newly created Board of Regents of Higher Education resigned last week over a scandal in which 21 education officials were improperly given hundreds of thousands of dollars in raises. Continued at ….. http://www.ctnewsjunkie.com/ctnj.php/archives/entry/regent-gate_taints_malloy_will_voters_remember/

 

 

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