With the increasing number of Connecticut residents testing positive for COVID-19, legislative leaders have decided to postpone the 2020 legislative session until April 20th. We hear legislative leaders have been communicating daily with their respective caucuses to assess the situation. It is unclear right now what the plan will be when, and if, the legislature returns. Legislators are waiting for revenue estimates provided on April 30th by Comptroller Kevin Lembo to assess Connecticut’s fiscal situation. Further complicating matters is that due to the pandemic, personal income tax reporting deadlines have been extended to July 15 along with the Federal government, so the April revenue numbers are not likely to be accurate. The General Assembly must adjourn on May 6th.
Some new developments this week:
Fiscal update: Significant concerns are being raised about Connecticut’s pension liabilities and how they are expected to grow significantly due to the economic fallout of the COVID-19 pandemic. Here is our report from Marc on the subject. A new report from the legislature’s nonpartisan Office of Fiscal Analysis also highlights the economic impact the virus has had on Connecticut’s budget outlook. The March 25 report projects a $178.2 million deficit for the current fiscal year, up $88.1 million from previous estimates. The OFA predicts the global pandemic of COVID-19 will have a significant impact on Connecticut’s budget for multiple years. Yankee Institute is researching and working on solutions to move Connecticut forward and restore fiscal stability to our state. This will require sacrifice from all of us. Stay tuned for details as we continue working on a plan to get Connecticut’s economy moving again.
Other news: The Department of Economic Development (DECD) announced a new bridge loan program for small businesses. The Connecticut Recovery Bridge Loan Program will make $25 million available to businesses and nonprofits in the state that have 100 or fewer employees to assist with cash flow. The Loan amounts are up to the lesser of either three months’ operating expenses or $75,000. Details include a 12-month term with a 6-month extension via request, 0% interest rate, and a personal guaranty and credit score requirement. Approval for the loan is contingent upon a business being profitable prior to March 10, 2020, and without negative credit reports of 60 past days overdue for the last 6 months. For further information, please see https://portal.ct.gov/DECD/Content/Coronavirus-Business-Recovery/CT-Recovery-Bridge-Loan-Program. The DECD has already suspended loan and interest payments on existing loans.
Governor Lamont’s latest executive order lifted the 10-cent tax on plastic bags, and prohibits employers of retail and grocery stores from requiring employees to bag items in a re-usable bag provided by customers. If a re-usable bag is brought in, the customer must bag their own items. Massachusetts has banned reusable bags. For an interesting twist on the plastic bag saga, please see Marc’s article. For Governor Lamont’s latest executive order, please see https://portal.ct.gov/-/media/Office-of-the-Governor/Executive-Orders/Lamont-Executive-Orders/Executive-Order-No-7N.pdf
On a positive note, please check out Yankee Institute’s “Beam of Light” project on our webpage. Yankee Institute is sharing stories of the heroism, generosity and communities banding together to get Connecticut through this crisis.
**Reminder: Yankee Institute’s Insider breakfast will take place on Thursday, April 2 @ 8:00 a.m. to 9:30 a.m. To ensure the safety of our guests, this event is now a conference call. Please register online at https://yankeeinstitute.org/event/insider/