Gov. M. Jodi Rell unveiled a plan Tuesday she said will erase Connecticut's latest budget deficit of nearly $470 million. Rell is expected to announce Wednesday when she'd like legislators to vote on the package.
This sets the stage for a showdown between a lame duck Republican governor and a Democratic-controlled General Assembly. It's unclear whether lawmakers would actually come in to vote on the governor's plan.
A big portion of the deficit _ nearly $130 million _ will be covered by forgoing an earlier plan to reduce Connecticut's sales tax rate from 6 percent to 5.5 percent. The reduction was supposed to take effect on Jan. 1.
Rell's plan also calls for freezing enrollment in the state's Charter Oak Health Plan for the insured, cutting state aid to cities and towns by three percent or $84 million, and cutting state agency budgets by more than $31 million.
"The reductions contained in this package cut across all levels of state government," said Robert Genuario, Rell's budget director.
Rell, a Republican, said she intends to call lawmakers back to the Capitol "soon" to vote on the package because most of her proposed cuts require legislative action. About $16 million worth are within her executive authority.
Senate Democratic leaders said it will take their members several days to review the governor's proposal and "examine its merits and disadvantages." Democrats earlier this year opposed many of the cuts Rell included in this latest plan, such as elimination of non-emergency dental services for needy Medicaid recipients and a reduction in college scholarship funding.
Legislators are already being urged to reject Rell's plan to cut municipal aid. The Connecticut Conference of Municipalities, which represents cities and towns across Connecticut, said cutting more state aid midyear wouldn't be a savings. Instead, CCM said it would shift more of the state budget deficit onto local governments and local property taxpayers.
CCM said cities and towns already lost $50 million in aid this year. But Rell's office said this proposal marks the first time that she has recommended cutting funding during this prolonged budget crisis.
"I don't for a second suggest this will be easy for any municipality," Genuario said. But he said the state can longer afford to shelter the cities and towns from the deficit problem. He maintains they're being asked to be a small portion of the solution.
"There cannot be any more sacred cows," he added.
Rell wants to create a new panel of lawmakers and municipal leaders to come up with ways to offset the state funding reductions, possibly by temporarily suspending state mandates on municipalities.
After months of wrangling with Rell, the General Assembly passed two-year, $37.6 billion budget on Sept. 1. Rell opposed the package, saying it did not cut enough spending, but allowed it to become law without her signature because she said the state needed a budget.
House Minority Leader Lawrence Cafero, R-Norwalk, said that budget "was not real" and was out-of-balance the moment it became law. Now, he said, lawmakers need to return to the Capitol quickly and vote on Rell's adjustments so the state can begin realizing those savings.
"Clearly, we have to act now to cut spending," he said. "It is the only option left."