Lamont promotes the power of jobs
Outreach to businesses among top priorities for incoming governor
Asked in a mid-September debate for the one word to sum up his focus if elected governor, Ned Lamont did not hesitate in delivering that word: jobs.
With Lamont readying himself for his own new job in Hartford, he is asking for more input from people who have hired in Connecticut — an exercise outgoing Gov. Dannel P. Malloy undertook after taking office eight years ago, only for many business leaders to sour quickly on his path.
If Lamont’s plan for economic development shares some of the tenets of Malloy’s — a charge his Republican opponent Bob Stefanowski leveled repeatedly in his campaign — he has built a business himself. And Lamont knows as well as any politician what it might take to get financiers investing in a region — his spouse Annie Lamont is a managing partner of Oak Investment Partners, a private equity investment giant with offices in Greenwich and Norwalk. The governor-elect suggested she will have significant input in the coming months and years.
In his campaign platform to spur job growth, Lamont said he would do so by making it easier for entrepreneurs to launch startups in Connecticut. The question becomes how Lamont’s brand of startup encouragement will differ from that of Malloy, with Connecticut having seen an increase in new company formation seven of his eight years in office according to business registrations filed with the Connecticut secretary of the state. That included a 7.8 percent increase last year and a 7.4 percent gain in new startups in the first nine months of this year, with some of those registrations representing existing companies filing anew.
Lamont says he can do better, with a number of proposals including changing Connecticut’s rules on non-compete agreements that would remove contractual barriers for corporate executives to set out on their own.
“We’re doing a lot of outreach in particular with the business community right now (to) let them know we need them at the table — what it means for them to stay and grow and invest in the state of Connecticut,” the governor-elect said Thursday in Hartford, in announcing his transition team. “I’m going to be bringing in folks from the business world that I know … and from the not-for-profit world, to bring a very fresh perspective in terms of what we
got to do.”
‘An effort to hold the line’
What Lamont can do will be limited by a budget that is projected by state Comptroller Kevin Lembo to run a $158 million surplus for the fiscal year that ends next June before hitting major deficits in coming years; and a General Assembly that did not back Malloy’s initiatives across the board.
Lamont said he will phase out Connecticut’s
business entity tax that generated $45 million in revenue in the 2017 fiscal year, which amounts to only $125 a year but is maligned by many business owners for its application regardless of whether a company turned a profit.
The incoming governor would also reduce Connecticut’s capital stock tax — at 0.37 percent of a company’s assets last year the highest of 16 states that charge one, according to the Tax Foundation — without saying by how much. Like New York, which is currently phasing out its own capital stock tax, Connecticut levies the tax
only if the revenue would exceed that it would collect from taxes on business income.
And Lamont would waive taxes on personal property for businesses with less than $10,000 in qualifying assets. The governor-elect acknowledges the state would lose little revenue but maintains it is a headache for small businesses.
“We’re going to hold the line on the income tax … (and) I will reduce the property tax, just enough to let your people know that we’re making an effort to hold the line there,” Lamont said
during an Oct. 30 debate at Foxwoods Resort Casino. “I’m going to be ruthless when it comes to looking at our health care expenses, looking at pension reform, looking at the big-ticket items that allow us to get this state going again.”
‘One step at a time’
Asked at a mid-September debate in New Haven on his policy regarding financial incentives for businesses — a major leg of Malloy’s economic development efforts ranging from “First Five” grants for corporations to Small Business Express loans — Lamont
suggested Connecticut will replace handouts with high-touch engagement to land growing companies. His business advisory team includes fellow Greenwich resident and former Pepsico CEO Indra Nooyi, who had been credited with opening a channel to the CEO of the information technology outsourcing company Infosys, which will receive at least $14 million in incentives if it hits a target of 1,000 jobs in Hartford.
With Malloy having mixed success with incentives to spur job growth — major victories include Charter Communications bringing its headquarters to Stamford — Lamont said he hopes to rely more on the power of persuasion.
“We lead with a bribe, and it’s the wrong way to go,” Lamont said in midSeptember at the New Haven debate. “The First Five program was a disaster for the state of Connecticut, (with) the governor picking and choosing. … You do it one step at a time going forward: not bribes, not incentives, not giveaways, not herky-jerky tax policy — consistency and reliability.”