Lawmakers hope budget deal has enough votes

HARTFORD — After closed-door meetings with their rank-and-file lawmakers, leaders of the House of Representatives said Thursday that there might be enough support for a compromise budget to come to a vote next week.

But both Republicans and Democrats need more information and will meet again next week before heads are counted and the nation’s longest-running fiscal impasse might end.

Gov. Dannel P. Malloy, who has already vetoed one budget, said he’s being kept in the dark on the details of the apparent bipartisan deal.

House members reviewed a potential deal that would make public school teachers contribute an extra 1 percent of their pay for their pensions, would reduce the Earned Income Tax Credit for thousands of lower-income families and end the $200 property tax credit on the personal income tax for many middleincome residents, limiting it to the elderly and those with dependents.

The compromise includes a cap on local vehicle taxes at 39 mills in the first year of the biennium, a move that’s good for city dwellers with high tax rates such as those in Bridgeport, Waterbury and Hartford. But it would eliminate car taxes entirely in the second year, meaning that towns and cities would have to raise real estate taxes accordingly to make up for the difference of about $750 million in revenue statewide.

Ongoing conversation

“We believe that not taxing the motor vehicle is a good policy,” said Speaker of the House Joe Aresimowicz, D-Berlin, adding that eliminating it would save time and money in local tax collections, the DMV, as well as car dealerships. “If it was rolled into the mortgage or the property tax payment, it would be a better program for us all. It’s a nuisance.”

House Majority Leader Matt Ritter, D-Hartford, said it’s an attempt to simplify an “archaic, bizarre” system of taxation and reimbursement for vehicle taxes in the budget year that starts next July 1.

“We’ll deal with it next year,” Ritter told reporters when asked for more details. “We want to pass a bipartisan budget next week. That’s the priority right now.”

“It is a lot of money, and towns and cities are going to have to make serious decisions, as we have made on the state level,” said House Minority Leader Themis Klarides. “It’s a conversation that’s continuing. That’s why I keep saying these are tentative agreements on major issues, and we’re going back to our caucuses and continuing these conversations.”

Klarides, R-Derby, said her 72 caucus members need more time, and information, to review the compromises. They will meet again on Monday. She said she did not take a head count of who might be in favor or against the budget, and admitted that some details have not been worked out for presentation to lawmakers.

“There are things people like, things people didn’t like and we have to make sure we look at the big picture here,” Klarides said. “We are all open-minded to getting more information and seeing how it goes.”

Klarides said the extra 1 percent from teacher salaries for their pensions would assist educators in saving for their retirement.

“This is helping them in the future,” she said outside the second-floor House chamber. “We held firm and made sure that the burden of teachers’ retirement was not put on the towns and cities.”

Hurdles remain

Malloy had wanted municipalities to pay $400 million for the employers’ share of local teacher pensions. Teachers now pay 6 percent of their salaries. Under the tentative deal, 25 percent of teacher retirement income would be tax-exempt.

Republicans succeeded in holding the line on the current 6.35 percent sales tax, which Democrats had proposed raising to as high as 6.9 percent.

Aresimowicz and Ritter said that they are sure the votes will be there to pass the budget in a bipartisan vote. But despite the handshake deal reached among House and Senate leaders, there remains a long way to go to end the budget stalemate that has lingered since July 1, when Malloy started running the state under executive order.

Klarides said Thursday’s caucus was aimed at providing House Republicans with as much information as possible. The session was suspended for about an hour when a smoke detector in a basement computer room went off, bringing Hartford firefighters to the Capitol.

“I have no idea what the budget looks like,” Malloy told reporters at about noon, as House Republicans reviewed the package one floor below in the Capitol. “I don’t have a document. Quite frankly, we don’t have anything upon which to basis judgment, except speculation.”

Malloy continued to warn that short-term revenue sources and traditional “gimmicks” may not be acceptable.

“We unfortunately have a non-collaborative governor on the other side of this floor, and we have to sit down and figure out how we’re going to best move the state of Connecticut forward,” Klarides said.

On Saturday, Aresimowicz and Senate President Pro Tempore Martin M. Looney, D-New Haven, are expected to meet with Malloy to discuss the pending deal. On Monday, Republican and Democratic leaders will meet again to discuss final pieces.

“We have found a balance and it’s good for the state of Connecticut,” Aresimowicz said. “I’m looking forward to a vote next week that will pass by an overwhelming margin in both chambers, move on to the governor, garner the governor’s signature and we can put the longest budget crisis in Connecticut history behind us and we can continue to make the state a better place.”