Not All Heroes are Created Equal
The Appropriations Committee met on Thursday (March 30) to vote on two bills — S.R 26 and H.R 26 — dealing with the disbursement of pandemic pay for state employees and members of the National Guard who worked through the pandemic. Some workers will see checks of up to $6,000.
Last year, $35 million in American Rescue Plan dollars was budgeted to fund the program but the State Employees Bargaining Agent Coalition (SEBAC) and the state went to arbitration because neither could agree on how to structure the payments.
The state argued that state employees had recently received pay raises and bonuses under the 2022 SEBAC agreement but the arbitrator — Susan Meredith — concluded that was a separate issue and sided with the union’s best offer totaling almost $50 million.
It’s a pity that the private sector front-line workers don’t have the ability to go to arbitration. Those heroes earning less than $100,000 were promised $1,000 in pandemic pay but that promise was broken due to the program being severely underfunded. The program had to be revised resulting in only those making less than $50,000 receiving $1,000. The bonus amounts decreased based on salary. Those making over $150,000 received nothing — including healthcare professionals who may have worked excessive overtime.
Both bills were passed favorably out of the committee and are headed to the House and Senate for a final vote. If it fails, the issue will be sent back to arbitration.
Work, Live, Ride or Else Bill
To address the lack of housing in the state, lawmakers passed a zoning reform bill out of the Planning and Development Committee last Friday (March 24). The bill also known as the Work, Live, Ride bill uses a carrot-or-stick approach to require towns to create transit-oriented developments (TOD) — or walkable neighborhoods. If not, they risk losing state-funded grants.
Municipalities with at least one passenger rail or rapid bus transit station that has over 60,000 residents will need to rezone for 30 dwelling units per acre. Those under 60,000 are required to build 20 per acre. Towns with any bus stop with over 25,000 residents would need to rezone for 20 units per acre and those with less must provide 15 units per acre. So that those without a transit service of any kind don’t feel left out, they will have to rezone for 10 units per acre if a neighboring town has one. Development must be within a half mile or “reasonable distance” of a bus or rapid transit station.
Any qualifying community that does not comply with the mandate — or as lawmakers call it the opt-in — will lose grants that are used to expand transportation systems or public sewer and water services, provide brownfield remediation, or “other related investments.”
Spoiler alert! This will affect most towns in the state.
Zoning decisions will be taken out of the hands of locally elected officials and given to an unelected “coordinator” in the Office of Responsible Growth. This coordinator is referenced repeatedly in the bill and will have the power to determine how much funding will be at stake. This individual will also have the ability to change housing density in a municipality if they decide the location fits within an arbitrary distance from a “qualifying bus transit community.”
The bill does not provide for local public input or an appeals process
TOD has positive results both environmentally and economically. But it can be achieved without stomping on local control and forcing towns to choose between zoning that works best for them and those being mandated in this bill.
Connecticut Misses the ‘Final Four’ by Less Than a Point
With tax season right around the corner, WalletHub, a personal finance website, released its annual report ranking tax burdens by state. They define a “tax burden” as the percentage of personal income residents pay toward state and local taxes — property taxes, income taxes and sales and excise taxes.
Connecticut is ranked as having the fifth worst tax burden with a percentage of 9.83. Rounding out the bottom of the list is Vermont (10.28%), Maine (11.14%), Hawaii (12.31%) and New York (12.47%).
Conversely, the top five most tax-friendly states are Alaska (5.06%), Delaware (6.12%) New Hampshire (6.14%) Tennessee (6.22%) and Florida (6.33%)
Tax Relief? Maybe
On Monday (April 3) the Finance, Revenue and Bonding Committee will hold a public hearing on Gov. Ned Lamont’s proposed revenue bill. The bill includes extending the bond lock by ten years — from FY 2024 through the end of FY 2033. The bond lock prevents the General Assembly from altering the state’s spending cap, revenue cap or volatility cap unless the governor declares a state of emergency or the legislature passes a bill with at least a three-fifths vote in each chamber. Currently, the lock is set to expire at the end of FY 2023.
The proposal will decrease the two lowest marginal rates in the Personal Income Tax (PIT). The 5 percent rate will be reduced to 4.5 percent and the 3 percent rate will be lowered to 2 percent. More than one million of the 1.7 tax filers will get some tax relief. Depending on adjusted gross income joint filers may receive almost $600 and single filers could receive almost $300.
The Earned Income Tax Credit (EITC) will increase from 30.5 percent to 40 percent of the federal tax credit starting in income year 2023. The increase will make Connecticut the fifth highest in the nation.
The bill will also make the Pass-through Entity Tax (PET) tax credit revenue neutral again. PET was created to help business owners circumvent the $10,000 cap on state and local tax (SALT) deductions in their federally taxable income. The cap was created in 2017 in the Tax Cuts and Jobs Act, while the rate was lowered to address budget shortfalls in the 2019 legislative session. If passed, the credit will increase from 87.5 percent to 93.01 percent.
Sadly, the bill extends the 10 percent corporate surcharge — that was set to expire this year — another two years.
Unfortunately, unlike the never-ending SEBAC agreement, some lawmakers like House Speaker Matt Ritter (D-1st) want to see sunset dates on these proposed cuts. Senate President Pro-Tempore Martin Looney (D-11th) said, “I certainly think that any income tax cuts that are proposed certainly should be sunsetted,” adding that “we budget two years at a time so nothing is ever truly permanent.”
The public hearing starts at 9:00 a.m. To let lawmakers know which sections you support and oppose click here to submit written testimony and here to register to speak.
Doth My Ears Deceive Me? TCI is Returning with a Vengeance
The Transportation and Climate Initiative (TCI) gas tax may be back and worse than before!
On the latest episode of ‘Y CT Matters,’ Chris Herb of the Connecticut Energy Marketers Association (CEMA) explains how a disastrous new bill would allow the unelected commissioner of the Department of Energy and Environmental Protection (DEEP) to implement TCI gas tax schemes without legislative approval.