As the state moves ever closer to its bonding cap, lawmakers have become interested this year in de-authorizing various bond projects.<\/p>\n
Republican Gov. M. Jodi Rell started the trend several months ago, making a proposed net reduction of $252 million in bonding.<\/p>\n
But the tax-writing finance committee moved to push that further to make $412.7 million in bond de-authorizations Monday, including 255 individual cancelations and reductions.<\/p>\n
“We have not added any new authorizations,” said Sen. Donald DeFronzo, a New Britain Democrat who co-chairs the bonding subcommittee of the finance committee. “We do not include any authorizations for the UConn medical school.”<\/p>\n
Rep. Carlo Leone, a Stamford Democrat who co-chairs the subcommittee with DeFronzo, said lawmakers are responding because of concerns about a “negative outlook” and potential bond downgrade from the Wall Street bond-rating agencies.<\/p>\n
“We all recognize that we’re in a tough fiscal environment,” said Rep. Cameron Staples, a New Haven Democrat who co-chairs the finance committee.<\/p>\n
With bipartisan support, the bond de-authorization bill was moved to the “consent” calendar for non-controversial items.<\/p>\n
Lawmakers also discussed the selling of bonds to refurbish the service plazas along Interstate 95 under an agreement that was reached with the state in November 2009. Under the old contract, the state got 11 cents per gallon from gasoline sales, and now the state is getting one cent, officials said.<\/p>\n
Lawmakers, however, were expected to vote on a bond bill – not the service plaza contract.<\/p>\n
The committee had been expected to vote on a highly controversial business tax, but that vote has been postponed until Tuesday – the committee’s deadline. The measure is known as “mandatory combined reporting,” which is strongly supported by the New Haven-based Connecticut Voices For Children. Voices says that the bill “would close corporate tax loopholes by preventing multi-state corporations from avoiding state taxes by artificially shifting their profits to subsidiaries in other states.”<\/p>\n
The Connecticut Business & Industry Association – the state’s largest business lobby – has been working against the combined reporting measure for years.<\/p>\n
Lawmakers also debated over municipal fee increases on a bill that divided chiefly along partisan lines – with Democrats supporting the fee increases and Republicans against. The bill would increase certain notary fees, town clerk fees, marriage licenses, burial and cremation permits, and dog and kennel license fees.<\/p>\n
Republicans spoke against the increases, even if some of them were relatively minor.<\/p>\n
“I recall the public’s outrage when their fishing licenses were increased last year,” said Sen. Toni Boucher, a Wilton Republican.<\/p>\n
“Some of these have not been increased in 30 years or 40 years,” Staples responded. “I don’t think overall that they’re really unreasonable.”<\/p>\n
“Nickeling and diming people on the town level is certainly not the answer,” said Rep. Themis Klarides, a House deputy Republican leader.<\/p>\n
Lawmakers also debated the creation of yet another blue-ribbon commission – a 17-member Revenue Accountability Commission. But veteran Republican Sen. Andrew Roraback of Goshen said the commission did not seem to have many proposed members with any expertise on taxes. Instead, members – who have not yet been named – would include people who represent large businesses, small businesses, and at least two who are “representing a policy-focused nonprofit entity.”<\/p>\n
“It’s just a bunch of regular folks – much like the legislature,” Roraback said, adding that he would vote against the bill because a revenue commission should have expertise on taxes.<\/p>\n
Part of the bill deals directly with the disclosure to the commission of confidential tax information, which has been a highly controversial point to the state Department of Revenue Services for many years. The debate prompted outrage by Rep. J. Brendan Sharkey, who tangled with DRS years ago when he served as the co-chair of the Program Review and Investigations Committee with Republican Cathy Cook. Sharkey has sharply criticized DRS for limiting information to the legislature.<\/p>\n
“This is exactly the conversation that took place about four years ago,” Sharkey said. “At that time, DRS told us they could not provide us with any aggregated data. As a result, the study was not as comprehensive as I would have liked it to be. … The state of Connecticut has been trying to deal with tax policy for the last five years with one hand tied behind its back because it can’t get the data.”<\/p>\n
Lawmakers also debated the creation of a regional hotel tax, which would funnel money to cities and towns, as well as regional councils of governments and regional planning organizations for property tax relief. The idea would generate about $19 million per year for cash-strapped cities and towns by increasing the hotel tax to 15 percent, up from the current 12 percent.<\/p>\n
The Connecticut Conference of Municipalities has supported the hotel tax as a way to help municipalities, which currently generate a large portion of their revenue from property taxes.<\/p>\n
“I am concerned with our hotel industry and how decimated it has been throughout this economic crisis,” said Rep. Vincent J. Candelora, the ranking House Republican on the finance committee. The bill “is trying to provide rate relief on the backs of our hotels.”<\/p>\n
Instead, the legislature’s appropriations committee should cut spending instead of having the finance committee raise taxes, Candelora said.<\/p>\n
Roraback spoke next, saying that a regional hotel tax would backfire in a difficult economy.<\/p>\n
“There’s been one goose that has been laying any golden eggs in Litchfield County, and that is our tourism agency,” said Roraback, who represents 15 towns in the state’s northwestern corner. “The goose has managed to stay alive. It hasn’t been thriving. This may end up putting a noose around the goose’s neck.”<\/p>\n
The region would clearly lose money “if we scare people off from spending the night,” Roraback said.<\/p>\n
But Staples, who voted for the bill, countered that the extra tax would not make Connecticut “non-competitive,” saying that the hotel rates are already higher in New York and Boston.<\/p>\n
“We are targeting a business that is very price sensitive that has been hit hard by this recession,” said Sen. Toni Boucher, a Wilton Republican. “They have a particular challenge in these times.”<\/p>\n
Klarides said she was more concerned about the hotel tax because tourists often head to certain areas of the state, like Litchfield County, for long weekends.<\/p>\n
“I really don’t trust this legislature with any more revenue than we already have,” said Klarides, a veteran lawmaker who first won election in 1998.<\/p>\n
Rep. Russ Morin, the former Democratic mayor of Wethersfield, said he has advocated the regional hotel tax for the past four years, saying it has been pushed by mayors and first selectmen across the state.<\/p>\n
“A 3 percent tax is probably not going to deter folks who are traveling,” Morin said. “That has never once deterred me from traveling to a location that I want to travel to. I am not buying that argument. … I guess being here four years has not given me enough time to distrust all of you.”<\/p>\n
Rep. Demetrios Giannaros, an economist who voted for the hotel tax, said citizens need to remember certain facts about the level of taxes in the state. Connecticut ranks No. 25 in state tax collections as a percentage of personal income, he said. Regarding sales taxes, Connecticut ranks No. 36 at 1.62 percent of total personal income. With billionaires living in Greenwich, the percentage of their incomes that they spend on various taxes is quite low.<\/p>\n
Sen. Michael McLachlan noted that his hometown of Danbury has one of the highest amounts of hotel rooms of any community of all 169 municipalities in Connecticut.<\/p>\n
“I think this is counterproductive in our economy,” said McLachlan, a Republican who opposed the measure. “I have a greater long-term concern about the tourism industry in general.”<\/p>\n","protected":false},"excerpt":{"rendered":"
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