House to try again on 2-year state budget

Connecticut residents will pay a new surcharge on their cell phone credit if a budget before the General Assembly is adopted. Connecticut residents will pay a new surcharge on their cell phone credit if a budget before the General Assembly is adopted. Photo: Kiichiro Sato / Associated Press Photo: Kiichiro Sato / Associated Press Image 1 of / 9 Caption Close House to try again on 2-year state budget 1 / 9 Back to Gallery

State legislators will try again Friday to approve a state budget that could slap a new surcharge on cellphones, imposes a fee to take an Uber ride and reduces a key exemption that lowers income taxes.

House members went home early Friday morning without taking a vote on a $37.5 billion, two-year budget.

Democratic leaders attributed the delay to writing final language and said they had the votes in the House and Senate to pass the budget. They warned massive, mandatory cuts to towns and cities would come after Oct. 1 under executive orders issued by Malloy.

Republicans sent their members home early Friday morning after saying Democrats hadn't put together enough votes to pass the budget.

House Speaker Joe Aresimowicz, D-Berlin disagreed. ”We have the votes,” he said.

State Sen. L. Scott Frantz, R-Greenwich said in a statement early Friday “Unfortunately what we have seen tonight is a complete lack of leadership by the majority in this building, a majority that once again tried to push major tax increases onto the businesses and hard-working families of Connecticut. Senate Republicans have had a balanced, line-by-line budget that was ready to be debated and voted on today, and that would have prevented the Draconian cuts to cities and towns called for by the governor.”

Gov. Dannel P. Malloy, who threw his support behind the spending plan cobbled together by his Democratic majority, said “the budget framework being finalized by the General Assembly appears to be a balanced and responsible compromise,” said Gov. Dannel P. Malloy, who threw his support behind the spending plan cobbled together by his Democratic majority.

But minority Republicans were not happy with the budget, saying it is laden with new taxes and fees and fails to reform state spending in a significant way.

The budget before the House, where Democrats hold a narrow seven-vote majority, includes a 49-cent monthly surcharge on the state’s estimated 3 million cellphones, a 25-cent fee for each ride-sharing trip and a 45-cent per-pack rise in the cigarette tax.

More Information New funding Here are some of the new taxes, fees and surcharges in the proposed state budget: 49 cent monthly surcharge on personal and commercial cellphones 25 cent fee every ride sharing trips 45 cent per pack tax on cigarettes Personal property tax exemption of $200 drops to $100. Seasonal mill rate for second or “summer” homes Six to eight percent rise in hospital provider tax 10 percent charge on fantasy sport companies gross receipts Rise in the hotel tax from 15 percent to 16.75 percent Town and city aid reductions: Municipalities must contribute $280 million over two years to the state teacher pension fund $783 million less in sales tax revenue through the Municipal Revenue Sharing Fund

The personal property exemption of $200 allowed on state income tax forms drops to $100, garnering the state $80 million a year. Other changes include a new seasonal tax rate of five mills for a “summer” home, which is expected to bring in $32 million a year.

The budget requires municipalities to contribute $280 million over two years to the state teacher pension fund, which is now fully paid by the state. Towns and cities would receive $783 million less in sales tax revenue distributed through the Municipal Revenue Sharing Fund.

A rise in the hospital provider tax, from 6 to 8 percent, would net the state $333 million a year. Democrats said the state’s hospitals agreed to the new tax.

While the broad strokes of how the budget sets taxes and fees was known Thursday evening, Democrats had not released a full document outlining spending and town and city aid, and remained in caucus into the evening.

Republicans, who offered their own budget for consideration, expressed frustration over the delays and a lack of transparency by Democrats.

”We are dealing with hundreds of pages of documents,” said House Republican Minority Leader Themis Klarides, R-Derby. “You either want transparency or you don’t.”

Malloy said the budget includes large cuts in spending and restores significant municipal aid.

”This budget includes hundreds of millions of dollars in spending cuts, achieving balance without any increases to the sales or income tax rates,” Malloy said.

”(The budget) would restore hundreds of millions in town aid, and includes a fair and transparent education funding formula that supports schools and students in communities across Connecticut, big and small,” Malloy continued.

Although Democrats control the House, the Senate is tied 18-18. Lt. Gov. Nancy Wyman, a Democrat, presides over the Senate and can break a tie vote.

Senate President Pro Tem Martin M. Looney said the Senate will convene at noon Friday to vote on the budget.

Malloy said “the urgency of the present moment cannot be overstated. It is critical that a responsible budget is passed by the General Assembly, one that provides greater predictability and stability for the people and businesses of Connecticut.”

State Rep. Christopher Davis, R-Ellington, said the budget offered by Democrats sets a wrong direction for Connecticut.

”I don’t support many of the policy choices that led to these estimates, whether new taxes, lowering property tax credit, raising cigarette taxes and raising fees in many ways,” Davis said.

Carol Platt Liebau, president of the conservative Yankee Institute, said the budget represents another tax increase.

”Once again, Connecticut lawmakers are balancing the budget on the backs of hard-working families with another massive tax increase,” Liebau said.

The Associated Press contributed to this story.