Lamont keeps CT budget within fiscal guardrails, pays down $500M in debt
Keith M. Phaneuf, CT Mirror
Gov. Ned Lamont stayed well within Connecticut’s fiscal
guardrails Wednesday, recommending a $26.1 billion budget that erases $500
million in bonded debt and invests in child care and education while largely
holding the line in most other places.
The spending plan for the fiscal year starting July 1
increases base aid for public colleges and universities but reduces overall
support despite warnings that it would leave higher education institutions in
deficit and forced to trim staff and programs.
The package bolsters K-12 education, though not as quickly
as legislators want, scaling back planned increases for magnet, charter and
vocational schools and keeping universal school meals afloat through December
with temporary funding.
Lamont would create several new posts to monitor health care
quality and finances but declined to recommend inflationary increases for
nursing homes or for the hundreds of private, nonprofit agencies that deliver
the bulk of state-sponsored social services. The administration also wants to
tighten Medicaid eligibility on the HUSKY program and require some poor adults
to purchase subsidized insurance through the state’s exchange.
And while the plan doesn’t include any major tax cuts —
following two years of hefty reductions — the administration is pitching a new
plan to try to secure hundreds of millions of disputed tax dollars from
Connecticut residents who work remotely for businesses in New York.
The governor’s proposal would boost spending 3.1% over the
current spending level and add just $89 million to the preliminary, $26 billion
budget he and lawmakers adopted last June for the 2024-25 fiscal year. And much
of that spending added onto the preliminary budget involves a nearly $80
million increase in the require state contributions to public-sector pension
funds.
But while Lamont repeatedly urged lawmakers recently to
embrace Connecticut’s spending cap and other programs that have secured big
surpluses, his own plan relies on a commonly used end run around the
guardrails.
Lawmakers often carry surplus funds from one fiscal year to
the next because these “carryforwards” then can be spent without counting
against future cap limits. Lawmakers already planned to carry $95 million from
this fiscal year’s $645 million surplus into 2024-25. The governor would boost
that to $140 million.
“For the first time in a generation, the state of
Connecticut is not lurching from one financial crisis to the next,” the
administration wrote in its budget introduction. “The state’s financial
position is stable, and, unlike other states, we are not facing deficits that
would result in deep cuts in spending or substantial increases in taxes.”
Transportation program debt
The fiscal guardrails have helped state government since
2017 to amass a $3.3 billion rainy day fund and pay down an extra $7.7 billion
in pension debt.
But Lamont also has been accused of accumulating too many
surplus dollars when it comes to the budget’s $2.1 billion Special
Transportation Fund.
This subset of the state budget fund is on pace to close
$241 million or 11% in surplus when the fiscal year ends June 30, according to
Lamont’s budget office.
And it finished the 2022-23 fiscal year with a 15% surplus,
equal to $277 million, according to final numbers from the state comptroller’s
office. And that was despite a 13-month gasoline tax holiday that returned
about $330 million to motorists. Most of that cost, $240 million, occurred
during the 2022-23 fiscal year.
The administration estimates the STF’s reserves — the fund
that holds all its annual surpluses — will total $911 million after this fiscal
year, a tally that exceeds more than 42% of the entire STF.
The transportation fund is supported by two fuel taxes, a
portion of the sales tax and a recently added highway mileage levy on
commercial trucks.
Republicans have accused the Democratic governor of hoarding
too much revenue and urged him to repeal the highway mileage tax.
Construction industries and trades have urged Lamont and the
state Department of Transportation to launch more capital projects. The STF
funds DOT operations and pays the debt service on the annual state borrowing
that, coupled with federal grants, finances repairs to Connecticut’s highways,
bridges and rail lines.
Lamont’s budget does assume annual borrowing for capital
work will grow from $875 million this fiscal year to $1 billion in 2024-25.
But he also would take $500 million from the STF reserve and
use it to reduce Connecticut’s more than $7.4 billion in outstanding
transportation bonding debt.
With more than $80 billion in unfunded pension and retiree
health care benefits and bonded debt combined, Connecticut is one of the most
indebted states, on a per capita basis, in the nation.
The administration estimates that wiping out this much
bonded debt at once will reduce debt service costs by $26 million next fiscal
year, and by roughly $60 million in 2025-26.
“This proposal builds on Connecticut’s recent budgetary
successes by leveraging our current financial position to pay down
transportation debt now and generate years of savings,” said state Treasurer
Erick Russell, who crafted the debt reduction plan in cooperation with the
Lamont administration. “This plan will strengthen the [transportation] fund and
leave the state well-positioned to take on transportation projects essential to
our economic growth and the quality of life of our residents.”
Lamont’s budget also assumes Connecticut will borrow $1
billion for transportation capital projects next fiscal year, a major jump from
the $875 million in financing estimated this year.
But the administration has dangled higher investments before
and not delivered.
This fiscal year, for example, it also projected $1 billion
in borrowing, but that projection has since gone down by $125 million.
The administration projected $1.2 billion in 2022-23 and
borrowed $830 million; and projected $875 million the year before that — and
borrowed $500 million.
Connecticut issued an annual average of $725 million in
transportation bonds between 2015 and 2018 under Gov. Dannel P. Malloy,
according to debt reports from the state treasurer’s office. During Lamont’s
first term, the annual average ticked upward just 2.6%, reaching an average of
$744 million — even though STF revenues grew 22% over those four years.
But the third year has just begun on a five-year federal
program to invest $1.2 trillion in the state’s transportation projects, and
construction industries and trades both said Wednesday that Lamont can’t afford
to wait any longer to get significantly more projects underway.
“Everyone knows infrastructure investments are the highest
return on investments,” said Don Shubert, president of the Connecticut
Construction Industry Association, who added the state should be borrowing and
investing closer to $1.5 billion annually in transportation projects. “And
failing to maximize all available federal funding and failing to invest at this
point is a tremendous, missed opportunity for the state.”
Nate Brown, president of International Union of Operating
Engineers, Local 478, said hitting the $1 billion borrowing target isn’t
sufficient. “We have to exceed the target,” he said. “We have the opportunity
of a lifetime. There’s people and contractors who are more than ready to go.”
Battling NY for tax dollars
Lamont’s new budget doesn’t include any major tax cuts —
which was expected given the huge reductions he and the legislature approved in
each of the past two sessions.
Low- and middle-income households are expected to save about
$460 million next fiscal year from the largest income tax cut in state history.
The changes, approved last year, include both rate reductions and several
enhanced credits.
The governor did recommend about $3.5 million in fee
reductions, removing initial application fees in understaffed fields including
nurses, teachers, and child care workers.
But the administration hopes to bolster the state’s coffers,
by as much as $200 million annually in future years, by challenging
controversial “Convenience of the Employer” rules in New York state.
Connecticut officials argue that New York rules unfairly
require many Connecticut residents who work remotely from home for New
York-based employers to pay taxes to the Empire State.
Lamont is urging residents to challenge the New York rules
in court. Those that are successful and receive a refund from New York would
then owe taxes to Connecticut.
Lamont proposes to add a 50% income tax credit to those
challengers, and to waive any penalties Connecticut could claim against them.
A spokeswoman for N.Y. Gov. Kathy Hochul could not be
reached for comment Wednesday morning.
Federal COVID relief
Lamont’s proposal also hinges on repurposing $55.7 million
in unspent federal COVID-relief grants, which provide great fiscal flexibility
because they can be spent outside of the cap system. But the shifting of these
American Rescue Plan Act funds is expected to spark many questions from
legislators, specifically: How much money have state agencies that received
federal grants left unspent?
All states must designate how these funds will be used by
Dec. 31. They still can be spent as late as Dec. 31, 2026, but purposes cannot
be reassigned after this calendar year.
Legislators also are expected to press Lamont over how much
of this fiscal year’s surplus can be used to support the next state budget.
Even though the governor recommended boosting the planned “carryforward” from
$95 million to $140 million, his fellow Democrats in the House and Senate
majorities have suggested using between $200 million and $300 million to
support numerous initiatives in health care, social services, and education.
Lamont also may face criticism for sweeping more than $16
million from a program that shares a portion of state sales tax receipts with
cities and towns. The administration says this transfer would not impact
municipal grants in the upcoming fiscal year, but it was not clear Wednesday
whether that could trigger challenges a few years down the road.
Other changes
Lamont also proposed folding the Connecticut Port Authority
into the Connecticut Airport Authority, consolidating the management of the
state’s harbors and aviation facilities under one umbrella.
David Kooris, the current chairman of the Connecticut Port
Authority, mentioned the potential merger between the two quasi-public agencies
during a meeting last fall, but little has been mentioned publicly about the
plan since then.
The Port Authority has been an issue for the Lamont
administration for years, largely because of the escalating cost of the
redevelopment of the State Pier in New London. That project, which is now
reaching completion, is meant to transform the port facility into a launching
pad for offshore wind projects in the Atlantic. But the cost of the project
ballooned from an estimated $93 million to more than $300 million.
The Lamont administration also proposed restructuring
payments into the pension plan for state judges to save $14.3 million next
fiscal year. Connecticut restructured payments into the state employees’
pension in 2017 and 2019, and contributions to the teachers’ pension in 2019.
Developer withdraws controversial quarry proposal for Ledyard historic site
Lee Howard
Ledyard ― Gales Ferry Intermodal LLC has withdrawn its
application to create a quarry operation at Mount Decatur, and a Thursday
public hearing on the proposal that drew a phalanx of criticism over the past
few months has been canceled.
An attorney for Cashman Dredging & Marine Contracting
Co. of Quincy, Mass., the parent company of Gales Ferry Intermodal, filed a
notice Tuesday with the town informing the Planning & Zoning Commission of
its decision. No explanation was offered, nor was there any indication whether
the application might be amended and resubmitted.
Harry B. Heller, lead attorney on the application, simply
wrote in a letter dated Tuesday, Feb. 6, that he was withdrawing from
consideration “the Special Permit, Site Plan and Coastal Site Plan Applications
currently pending before the Town of Ledyard Planning and Zoning Commission for
the extraction and processing of earth product and stone” at the former Dow
Chemical property off Route 12.
Town Planner Juliet Hodge said Wednesday morning that she is
unsure whether Gales Ferry Intermodal would be refiling another application for
the site or what that would look like. She added, however, that if the company
does refile the whole public hearing process would have to start over.
David Tranchida, a spokesman for Gales Ferry Intermodal,
said the group decided to pull its application to look at various concerns
expressed by nearby residents as well as recent questions from the town planner
to try to determine what the company’s next steps might be. He said he couldn’t
give more specifics until a final decision has been made, and calls to a GFI
principal went unreturned.
Virginia Beall, who lives nearby and opposes the project,
said Wednesday that she believes the applicant rescinded the project because it
was becoming clear it would be denied. She is hoping that if Gales Ferry
Intermodal submits a new plan, it will involve the site’s use as a
transportation hub or a light industrial area.
“I’m opposed to the idea economic development takes
precedence in this town over quality of life,” Beall said.
Over the course of three public hearings during the past
several weeks, the quarry proposal has been criticized for its possible effect
on the neighborhood, including worries over the health effects of silica dust
being released to the atmosphere, as well as concerns about blasting, increased
truck traffic, loss of bird habitat and the degradation of Mount Decatur, which
is the site of a historic War of 1812-era fort.
Dozens of residents and local groups have opposed the
application, while only one person, who lives in another town, expressed
support.
Gales Ferry Intermodal had pointed to another quarry
operation in town that received approval in recent months as proof that the
proposed project could live comfortably within a neighborhood setting. The
company also had promised to leave intact the portion of Mount Decatur that
contains historic significance.
Beall, who is on a citizens group called the Dow Community
Advisory Panel, said she would like Gales Ferry Intermodal to take neighborhood
concerns seriously, as Dow Chemical did in the past when its officials met
regularly with locals. But she says the panel has been much less active
recently after Dow sold the property, initially leaving Americas Styrenics as
the main operation on site.
Beall said she is concerned that another proposal for the
site might not be much better than the last without citizen input.
“We’ll have to see what happens,” she said.
Developer Abruptly Withdraws, as Zoning Seeks Mix of Affordable Units in Downtown Stamford
Angela Carella
STAMFORD – Zoning Board members were nearing the end of a
discussion about a proposal to build 471 luxury apartments in a prime downtown
location when something unexpected happened.
The developer called off the discussion.
At the time, board members were discussing whether to allow
the developer, Carmel Partners of New York, to contribute money to Stamford’s
Affordable Housing Trust Fund rather than include reduced-rent apartments in
its project on Clinton Avenue along Mill River.
Under the city’s Below Market Rate program, developers must
offer at least 10 percent of units in a project at reduced rents. In lieu of
that, they may seek approval to contribute the value of those units to the
affordable housing fund instead.
Carmel Partners was asking the board to approve the cash
offset which would have added nearly $13 million to the fund.
But this time board members instead wanted a portion of the
required 49 reduced-rent units to be included in the Clinton Avenue project,
because board members felt it was the ideal location for below market rate
apartments and would allow low- and moderate-income residents to live within
walking distance of transportation, jobs, shopping and Mill River Park.
So board members suggested a hybrid arrangement – build some
BMR units on site and generate a contribution to the fund, which provides
grants to nonprofit agencies that create affordable housing.
“A project like Clinton Avenue provides affordable units,
and sooner than the trust fund. Land is getting so expensive in Stamford that
it takes nonprofits longer to get projects done,” said the chair, David Stein.
“I’m open to splitting it. I think it’s a good way to handle this.”
As other members were agreeing, the city’s principal
planner, Vineeta Mathur, interrupted. She’d received an email from the
developer, whose team was watching the meeting Monday night on Zoom, Mathur
said.
“The email says that if the board is considering a hybrid
approach, they would like to withdraw their application,” Mathur said.
Board members were taken aback.
“I don’t get that,” Rosanne McManus said. “I don’t get that
at all.”
“I don’t, either,” Stein said.
Board member Gerry Bosak Jr. asked whether a developer is
allowed to email a message into a live meeting to withdraw an application under
discussion.
“I mean, is this protocol? We’re trying to meet them
halfway, and to fulfill the needs of the community,” Bosak said.
“This has been known to happen,” Stein said.
The city’s Land Use Bureau chief, Ralph Blessing, reminded
the board that the project is already approved with on-site BMR units, so it
can move forward with zero contribution to the Affordable Housing Trust Fund.
“We’re going around and around,” Bosak said. “It really
comes down to the applicant.”
“I agree,” Stein said. “Is the application being withdrawn,
or is it still filed? Because, if we vote, it will be too late to withdraw it.”
Stein appeared ready to call for a vote; Blessing stepped in
to reiterate that, if the board decided to require both on-site BMR units and a
contribution to the housing fund, “you might end up with all units on site.”
“OK,” Stein said. “I would regret that if it happens, but I
don’t like to be threatened. And I feel like that’s a threat at this point.”
Mathur interrupted again.
“They withdrew,” she said of the developer.
“They did withdraw,” Stein said. “OK.”
He then took up a brief final item on the agenda and ended
the meeting.
It was weird, Bosak said Tuesday. Developers usually work
with the Zoning Board in such instances, he said. In this instance, he said,
the board was seeking a compromise with the developer.
“I was absolutely surprised by the withdrawal,” Bosak said.
“I wanted to get some units on site because the city has such a need for
affordable housing. I recognize the nonprofits do this type of development very
well, but I didn’t want to wait for that.”
Nonprofit agencies that build affordable housing units have
to amass funding and find land they can afford, which is becoming increasingly
difficult in Stamford. That usually takes more time than it takes a private
developer to build a project, and the BMR units that go with it.
The previous owner of the Clinton Avenue parcels brought the
boards a plan to build 456 apartments with all 46 reduced-rent units on site.
The proposal languished from 2016 until 2022, when Carmel Partners bought the
parcels.
The Carmel Partners proposal is 471 apartments and a request
for a special permit to build no BMR units on site, putting the $13 million
into the housing fund instead.
It’s unclear what will come of the large project, which as
proposed would construct two seven-story apartment buildings on 4.4 acres along
the river on either side of Clinton Avenue.
Jason Klein, an attorney with Carmody Torrance Sandak &
Hennessey who represents Carmel Partners, did not respond Tuesday to requests
for comment.
Klein told the Planning Board last month that it’s “a
challenging time” to get financing for developments, and that obtaining
financing for a project that builds some reduced-rate units on site and makes
some contribution to the affordable housing fund “may not be feasible.”
But Planning Board members last month voted unanimously to
recommend that the Zoning Board do just that.
Bosak said he agreed with the Planning Board recommendation,
which was why he made the motion that the Zoning Board follow it. But Carmel
Partners dropped out before the Zoning Board could vote.
“I thought my motion was a measured response to the
developer taking back the original proposal to put all BMR units on site,
proposing instead to put none on site,” Bosak said.
How will West Hartford reconstruct its town center? Some questions remain as new plans are shown
WEST HARTFORD — The reconstruction of the bustling West
Hartford Center is looming. Sidewalks are narrow and hazardous, trees need to
be replaced, and the existing pedestrian infrastructure is outdated and at
times unsafe.
The question that remains, though, is just how far the
reconstruction of LaSalle Road and Farmington Avenue — two roadways lined with
restaurants and stores attracting residents and visitors to the area — will go.
The West
Hartford Center Infrastructure Master Plan was first revealed a year ago,
with plans to elevate the popular dining and shopping destination to a higher
level by replacing and enhancing sidewalks, crosswalks, and other
infrastructure.
But in November, at
a meeting intended to inform local business owners about the plans,
concerns were brought about losing parking spaces, as well as the disruption
that construction might bring, taking the town back the drawing board — though
the original plans are still very much in consideration.
On Wednesday morning, the town showed off potential design
options, ranging from keeping the status quo but still replacing sidewalks and
trees while enhancing pedestrians safety, to fuller transformations that
include a shift in parking from angled to parallel that would leave more space
for wider sidewalks, permanent expanded outdoor dining, and even buffered
sidewalk-level bike lanes.
LaSalle Road
Duane Martin, the town's director of community development,
confirmed Wednesday that no construction will be taking place in 2024. But next
year, it's likely that work will start on LaSalle Road. What that
works entails rests on a decision yet to be made by the town manager's
office.
Currently, LaSalle
Road has two-way traffic and features angled parking on both sides of
the street. Its sidewalks are narrow, with only 4 to 6 percent of the
streetscape being devoted to pedestrians compared to 70 percent of the
streetscape being devoted to parking and travel lanes.
That could be altered substantially by turning the road's
angled parking into parallel parking, which would increase pedestrian sidewalk
space to 10 percent and reduce vehicle space dramatically to 36 percent of the
streetscape. More room would also be made for dedicated outdoor dining, which
since the pandemic has been done in parking spaces.
But to do that, the town would need to remove 37 on-street
parking spaces, something that concerned business owners whose restaurants and
storefronts line the street. Since 2020, the town has been temporarily removing
dozens of parking spaces each spring, summer, and fall to accommodate expanded
outdoor dining. There also isn't a lack of parking in West Hartford Center, the
town's consultant Stantec said, with over 2,500 parking spaces available in the
area between surface lots, street parking, and parking garages. Another 2,700
parking spaces are also available in Blue Back Square.
New designs posed on Wednesday showed one option, called a
baseline reconstruction, keeping the sidewalk widths as is, but repairing and
enhancing other features. Another design, called a hybrid option, would
combined keeping angled parking while still expanding sidewalks.
"In this scenario, we slightly widen the sidewalks by
reducing the overall curb to curb dimension from 70 feet to 60 feet, so that
gives us five feet extra on either side," said Travis Ewen of Stantec,
about the hybrid proposal. "That allows for a little bit wider outdoor
dining, some more landscaped areas and from the original parking of 107 spaces
we go to 88 spaces, and that again accommodates for loading zones and the
bumpouts to make safe crosswalks."
Farmington Avenue
A similar decision about whether to give more space to
vehicles or to pedestrians and cyclists will also need to be made on
Farmington Avenue.
Currently, 57 percent of Farmington Avenue is devoted to
vehicle traffic and parking. Another 4 to 8 percent, depending on which side of
the road you are on, is dedicated to pedestrians. Initial designs would shift
that by making all parking parallel, leaving only 37 percent of the streetscape
for vehicles. That would widen sidewalks to 9 percent of the streetscape on
each side of the street, but also introduce buffered sidewalk-level bike lanes
taking up 14 percent of the street.
"It's something we consider for all of our roadway
projects," Martin said about bike facilities. "We are responsible for
designing the roads, as best we can, for all users. There are challenges,
especially in the Center, where we have a lot of conflicting needs for space
with parking, outdoor dining, and bicycle facilities. We don't want to ignore
safety for all users."
Like with LaSalle Road, the town has also included a
baseline reconstruction that would only widen sidewalks slightly and do away
with proposed bike lanes. A proposed hybrid design option would include a
shared pathway for low-speed cyclists and pedestrians. A fourth proposal would
feature parallel parking with "conventional" bike lanes painted onto
the roadway not buffered or protected by anything.
No matter what designs are chosen, attention will be paid to
pedestrian safety. The town is planning to shorten lengthy crosswalks with curb
changes and new bumpouts, meaning pedestrians crossing both LaSalle Road and
Farmington Avenue will walk shorter distances. There are also plans to raise
sidewalks, which could be a useful tool for slowing traffic and increasing
pedestrian visibility.
"A lot of the materials for the crosswalks are at the
end of their useful life," Ewen said. "There's been utility work
that's gone on, snowplowing is a constant issue with that, so there's some
upgrades that should happen in order to create better surfaces. As part of this
project, we analyzed and highlighted traffic and pedestrian safety concerns.
That really started to correlate with the street widths and the crossing
distances. Once we started to see crossing distances over 50 feet, that's when
we saw a spike in the crash locations."
Construction and cost
A lingering concern for business owners who attended the
meeting hovered around how exactly construction, and any disruption that comes
with it, would be handled.
Martin said the project will utilize night work when
possible, which should alleviate some of the disruption businesses might
face.
The plan will also be done in phases, meaning that when work
begins on LaSalle Road next year that the entire street and sidewalk won't
be disturbed all at once. Instead, work will be done in bits and pieces,
continuing down the roadway until complete. But with no plans in place or
designs chosen yet, the exact construction process hasn't been finalized.
Cost was also a concern from some who attended the meeting.
At the low end, consultants estimated the project could cost $8 million if the
town elects to opt for baseline reconstructions that don't alter the
streetscape design too much. The more alterations needed, the more the project
cost would increase. But Martin said none of it will be footed by taxpayers,
with the town prepared to propose using its American Rescue Plan Act funds for
the project, which would need to be approved by the Town Council.
The full presentation
can be viewed on YouTube and includes interactive polls that will
remain open for a few more weeks. Design option will
also be posted to the town's website. No decisions have been made yet
and Martin said another public meeting would be held within the next two months
before decisions are made by the town manager.