Malloy: More state budget cuts on tap
Published 4:41 pm, Wednesday, January 25, 2012
About 750 vacancies in state government are in limbo following Gov. Dannel P. Malloy's announcement Tuesday that he is planning $79 million in immediate cuts to balance the state's budget.
Malloy, citing budget-cutting authority that allows him to slash up to 5 percent of operating budgets, said the rescissions are the result of a sharp drop in tax revenue in the $20 billion budget that ends July 1.
He said it's part of the price the state is still paying for the $3.5 billion deficit that met him upon entering office last year.
"We've gone from something approaching 20 percent of total expenditures to something approaching less than a percent of total expenditures, actually 0.26 percent of total expenditures," Malloy said.
But minority Republicans in the General Assembly warned that the governor may face at least another $32 million in cuts because his budget had already anticipated more than $40 million in end-of-the-year savings, called lapses, in the $79 million.
In a morning meeting in the Capitol, Malloy and Benjamin Barnes, the secretary of the Office of Policy and Management, told the governor's commissioners to revise their hiring plans and prepare for further review. Layoffs are not planned though, in the wake of the deal last year with unionized state employees to accept concessions on benefits in exchange for four years of job security.
Since last July, about 250 new employees have been hired, with a total of 1,000 positions scheduled to be filled. Now, about 750 vacancies have to be reviewed again, and commissioners will be asked to justify their hiring.
"The bottom line is we've come a long way and we have a long way to go yet," Malloy said to commissioners, as Barnes passed out copies of the rescissions, which include $28 million in the Department of Children and Families; $14.5 million in the Department of Mental Health and Addiction Services; $2.7 million in the Department of Developmental Services; $1.9 million in the Department of Economic and Community Development; and $1.7 million in the Department of Public Health.
Malloy said that reducing spending any further is bound to affect state programs.
"Every one of them has the potential of doing that," Malloy told reporters before flying to Switzerland for the World Economic Forum. "I think taken on in their entirety it's a relatively small impact."
Barnes told reporters that the DCF reductions will include renegotiating contracts. "We are going to be squeezing contractors. We may be delaying certain activities until July 1. Clearly, we are not going to withhold placement for children in our care or threaten the safety of any individual or the health of the citizens of Connecticut with these actions."
Senate Minority Leader John McKinney, R-Fairfield, said after reviewing the governor's cuts that he believes additional cuts are likely because about $42 million of the rescissions were already included as projected year-end savings.
"Absent further action, we'll end up with a $31.9 million deficit," McKinney said in an afternoon phone interview. "We need to make sure those cuts and savings come and find out where they're coming from. I think it would be better, in the spirit of transparency, that those agencies list those savings in short order."
Barnes, Malloy's budget chief, said that the budget has anticipated a total of $900 million in lapses.
House Minority Leader Lawrence F. Cafero Jr., R-Norwalk, said he was particular concerned about more than $200,000 in education cuts on the eve of a legislative session that is supposed to focus on state schools. He said the new cuts are an admission that even with record tax hikes last year, the governor is having trouble keeping the budget out of deficit.
Barnes, in a phone interview Monday night, did not dispute the Republican statements on double counting lapses. But between the signs of the strengthening economy and the potential for not hiring hundreds of new workers, Barnes said the budget will come into balance.