Governor Ned Lamont First State 2019 Budget Address Speech
The Accurate Source To Find Transcript To Governor Ned Lamont First State 2019 Budget Address Speech.”
[Governor Ned Lamont First State 2019 Budget Address Speech]
[Edward Miner Lamont Jr. (Ned Lamont):] Source: LYBIO.net
Mr. President, Mr. Speaker, Senator Fasano, Representative Klarides, Members of the General Assembly, fellow state officials, Lt. Governor Bysiewicz, honored guests and the people of the great State of Connecticut.
Today, I am presenting you a budget which gives us the best chance to get this state growing again.
Connecticut has been a jobs laggard for many many years, which depresses opportunity and hits our budget every year.
If we had grown jobs at the same rate as other states, we would be talking about how to invest our surplus or cut taxes. Instead we are staring down the barrel of a $3.7 billion dollar deficit over the new every budget cycle.
[Ned Lamont:] Source: LYBIO.net
What does this say, I can’t read a damn thing.
I will not allow this budget to be another scene from Groundhog Day, where I come to you year-after-year hat-in-hand lamenting the fact that we still haven’t addressed our structural deficits.
The fiscal crisis before us is not just a short-term hole in the budget.
We’re digging that hole deeper every year – $400-$500 million annually, due to fixed costs such as pensions, retiree, healthcare – bonded debt—all growing faster than our economy. Most of these fixed costs pay for the past rather than investing in our future.
Fixed costs inherited from the past consume nearly a third of Connecticut’s budget – much more than our peers. That hurts our ability to make investments in our future -putting us at an enormous competitive disadvantage.
But I can’t fix this chronically broken budget without each and every one of you.
The legislature is a co-equal branch of government and I need you at the table, helping me explain to business and labor, our mayors, our boards of education, and most importantly our taxpayers – what we are doing and why.
And where we differ, don’t hold a press conference. Come talk to me! Take a breath, suggest a better alternative and the numbers must add up.
We just celebrated George Washington’s birthday!
You never know!
So we just celebrated George Washington’s birthday – and I promise you – this is my last Hamilton analogy, so help me God – But George Washington – ah ha – I got an applause – as George Washington tell young Alexander Hamilton winning is easy, young man, and governing is harder. And let’s prove them wrong.
Let’s try a different type of politics, and let’s not wait until the summer to do it. Loudly, and from all across the state, I heard the same thing from our local leaders – Ned, I’m willing to live within our means, I can tighten our belt – but I need to know what those means are so I can plan accordingly.
So look, if you hate my proposal today, don’t wait til June to tell me what to do – let’s sit down tomorrow and get to yes – sooner rather than later.
When it comes to balancing the budget, my urgent priority is stabilizing the teachers’ pension fund.
It’s not just –
It is badly underfunded and doesn’t keep faith with our current teachers, especially the younger ones. The state compounded the problem – maybe a decade ago – by layering on a pension obligation bond, which, let me put this gently, didn’t work out the way we hoped.
Now let me be blunt, if we do not fix the financing schedule, our current payment plan could have disastrous consequences.
Our annual contributions to the Teachers’ Retirement Fund could end up being higher than the amount the state pay on education – across the state.
So working closely with Treasurer Shawn Wooden, we’ll restructure our pension contributions there. This will reduce our annual payments, reduce our financial risk and give teachers the confidence that their pension will be there when they need it.
We’ll also assume a more conservative and realistic rate of return assumption.
Similarly, the state employee plan still represents a large share of the overall budget and accelerates state payments at $100 million dollars every year – and that’s an unacceptably high cost which would either force draconian cuts to needed services, or large tax increase.
So again working with the Treasurer and our friends in labor, we want to smooth out those payments on both pension systems, so our annual contribution is a lower percentage of our budget over the next generation. This is similar to what you would do in a pinch with your own home mortgage.
And to those of you who say – this sounds like we are stretching out these mortgage-like payments over a longer period of time – we’re just kicking the can, I gotta tell you that – this is a crisis that’s been generations in the making.
And it’s gonna take a while to work our way out of this – we need the breathing room to maintain our current commitments, in education, transportation and workforce development, and we need to provide stability to our towns and cities, some of which are struggling with solvency issues of their own.
In addition –
We must slow the rate of increase on our pension obligations and tie future cost of living increases to the performance of our pension fund.
[Ned Lamont:] Source: LYBIO.net
And when markets perform well, the cost of living adjustment goes up, and when markets are down the COLA is a little less generous.
Our teachers are already on this track. And this will require tough negotiations, but we gotta start.
These pension reforms – they do not solve for world peace – they are just a start, but they offer a reasonable basis for long-term fiscal stability and building business and consumer confidence, which is a precondition to getting our state growing again.
The next big structural reform focuses on healthcare, specifically our state employee and retiree healthcare. The state of Connecticut provides healthcare coverage for approximately 200,000 individuals.
Let me be clear, we are not taking away anybody’s healthcare, a deal is a deal.
But our healthcare costs are growing much faster than our economy, meaning that we must do a better job of controlling costs if we are to continue investing in our future.
Comptroller Lembo and our team are working with our state employees to forge a path where the state no longer pays whatever a healthcare provider charges us, but instead sets a ceiling on the maximum price the state will pay.
And we’ve looked at this Kevin and I – there is not a real correlation between quality care and cost – and the cost for these medical procedures is all over the map.
So listening to our friends in Labour we are also going to build upon the state’s “Smart Shopper” program. What that means?
We provide cash incentives to our state employees for selecting quality, cost-effective health services. So our employees receive quality, more affordable healthcare and the state will pays less.
I want to make one important personal point.
To those of you who believe we are not asking enough of our state employees, just remember that these are the folks who work their heart out for each and every one of us every day – they are taking care of our kids, taking care of our parents, keeping us safe – they’re fixing our roads. And they have a contract that extends to 2027, I am asking that we sit down now together in good faith and we’re all talking because you all care about the future of our state. And I thank you for that.
Some of the old pros here they’ve suggested that I should hold off on these discussions for a few years when I have more leverage – the threat of layoffs to propel the negotiation. Forget it.
We can’t afford to wait two years and frankly, threatening the layoff our newest employees who are doing important work that’s not the way I negotiate and that’s not the way I treat people.
I also know that there tens of thousands of our state employees who are going to be retiring over the next four years. And I have to work to plan for that. How we work together to fix our long-term pension and healthcare costs will impact my thinking on the mix of state employees and outside providers in our Governments future.
Some of you think that Connecticut needs a “Wisconsin Moment” – where we walk away from collective bargaining and tear up our contracts. I want an anti-Wisconsin moment – a Connecticut Moment –
I want a Connecticut Moment – where we show that collective bargaining works – not just for retirees but also for the next generation of state employees, and the next generation of taxpayers.
We can make this work.
Okay, the other portion of our fixed costs that drives our structural deficits – bonded debt. Over the last eight years, our bond authorizations skyrocketed.
In fairness, we made some important capital investments and some nice-to-have investments – but the payback of the principal plus the interest is consuming more and more of our budget.
Our budget – my budget reduces bonding authorizations by nearly $600 million dollars a year –
– it will greatly reduces the fixed cost of debt going forward.
I have talked to a lot of you – I know you agree in principle, but then you have one more special project that’s in the cue in my District – so be forewarned – if it is not tied to workforce and economic development, or cost-saving shared services, Connecticut is on a debt diet – and I am going to make sure we stick to that plan.
Memo to self – crickets!
Alright, while I’m at it.
We also here in this room also got to do our part to reduce these fixed costs.
And I recognize that some of you are proposing bills whereby your mileage allowance would no longer be rolled into your pension base.
Thank you for taking the initiative. When passed, I will sign that bill.
I have a mixed reaction.
On the operating side of the budget now!
We are cutting back on middle management. And I asked my commissioners for some ideas to cut costs or make their departments even more efficient. Some great ideas came from the top: Commissioner Jim Rovella Public Safety – he suggested replacing the State Trooper auto fleet every five years – not instead of four!
And putting civilians on desk jobs to allow more State Troopers to do what they do best – protect Connecticut.
And me –
At DMV, you’re not going to need to get your licenses or registration renewed quite as often.
We’re also going to move these transactions online – not in line.
Going forward, we will also look at the cost and frequency of licensing for the trades and other professions, providing additional savings for folks in small business.
We have a new leader at the Department of Administrative Services – Josh Geballe – who spent 11 years at IBM.
I have proposed a significant investment in technology and IT personnel to modernize and digitize state government. Moving transactions from manual to online can reduce costs by north of 75%.
Today, we have probably 2,000 plus forms that people fill out and less than 5% of them can be completed online.
So as we digitize these interactions, we will achieve cost savings – a better customer experience. And you’ll see these savings reflected in my next budget.
[Ned Lamont:] Source: LYBIO.net
And we expect transparency from our state agencies, and I demand it from our quasi-public agencies as well, such as the lottery, too. I’ve proposed legislation that will ensure we have access to their books and their bottom lines – our taxpayers expect nothing less.
OK, I can still hear it – “Come on! Governor, cut more – cut more, now!”
I come from business!
But unlike business, I can’t just say to patients on the road to recovery at the Department of Mental Health or to children in crisis at DCF. I can’t pay the bills. I can’t tell the elderly that there is no room at the inn. I can’t simply shut down an underperforming department.
But we can – and must – provide better service at a lower cost with a more efficient and more responsive state government – and that starts now.
Alright, now over to the revenue side.
Because I refuse to pour money into a leaky bucket!
I’ve led with the structural changes that give us the best chance to stabilize our escalating fixed costs.
I have not proposed raising the income tax rate, which has been raised 5 times over the last 15 years with diminishing returns.
And I am not proposing an increase in the sales tax rate because I believe we have to reform our sales tax for the 21st century.
What do I mean by that?
Our current sales tax is designed for a Sears Roebuck economy driven by over-the-counter sales.
Today we live in an Amazon economy which is driven by e-commerce, digital downloads, consumer services.
So my sales tax reform proposal would broaden the base of the digital goods are treated equally and more significantly that we are capturing a growing segment of the economy.
For example, Movie theatres charge a tax, why shouldn’t Netflix be treated the same.
And under our budget proposal –
Uh- Netflix subscriber! Ha!
Under of budget proposal, consumer-oriented services will no longer be tax exempt.
And it’s so erratic, I mean, why do you have to pay a tax on manicure and you don’t pay sales tax on a haircut?
So expansion of the base helps to make the sales tax more robust, fairer, and raises the revenue we need to get our budget into balance. And believe me, I have been forewarned by all of you – this – there was bipartisan consensus on this, that every tax expenditure has a strong lobby behind it and the pushback will be ferocious.
Alright – if you find the haircut lobby pretty persuasive, we have an amazing head at OPM Melissa McCaw – who you, some of you heard from today, hey, we’ll model out – hey that got something – and she will model it out.
And she will model it out how we can expand the base and reduce the rate and narrow the base and expand the raise the rate, I’m gonna work this with you – Melissa is non-stop!
The only reason she leaves the OPM building is the security-guards kick her out at 11pm – and cause I won’t pay for any more overtime.
Alright, I welcome you to this debate.
And if you disagree, have at it, but again the numbers must add up at the end of the day.
Under our budget proposals, we are making a commitment to education. While some towns that are losing stock population will receive a little less, other towns with growing populations and more kids in need will see more investment.
In addition, many of our school districts have chosen to pay their teachers much more than the state median. It’s a great investment for their community. But it’s an investment that impacts the state’s overall pension obligation.
So our budget will ask every municipality to make a contribution toward normal teacher costs, but towns like mine – Greenwich, which pay teachers about 30% more than the state wide average, they will be asked to pay that extra amount as well into the pensions.
This reform –
This reform ensures that municipalities have some skin in the game and the pension burden is shared more fairly.
One big priority for me: on a personal basis – recruiting more teachers to our tougher schools, reaching out to more teachers of color, and more male teachers.
And we do this by being bolder on the incentives we provide to teach in those schools – such as tuition reimbursement and down payment assistance programs.
Our children benefit from role models and mentors they can look up to. And this is one more step to closing the opportunity gap.
And while we’re holding the line on operating costs and bonding, larger schools and districts which pool resources, sharing superintendents – sharing back-office functions, they will receive priority for new bonding.
Let’s incentivize smart choices and strategic decisions.
I prioritize education as the opportunity engine for all of our young people. It’s the key to workforce development, assuring also that our businesses large and small have the talent they need to grow in the future.
I’m asking everyone to do a little bit more, and that includes business.
In my proposed budget, business are not going to get the elimination of the 10% surcharge they were expecting this year, but I am proposing to eliminate the Business Entity Tax, which is a costly nuisance, especially for our small businesses.
And I’m inviting Connecticut businesses to step up and partner with me to help the next generation of talent repay their student loans and save for their futures.
So to kick-start this effort, Travelers Insurance – Stanley Black & Decker have agreed to offer their own loan forgiveness programs, and together we are inviting other Connecticut companies to join them. Help us train, attract and retain top talent in our state and make it affordable!
Make Education Affordable!!!
Another way to drive economic development to our urban centers and distressed communities is to take advantage of the new Federal opportunity zones.
I want Connecticut to be one of the fist states out of the box on this – by aligning our existing state resources to provide that targeted support, we can invest tax-free in these areas creating good paying jobs for folks who need it the most.
[Ned Lamont:] Source: LYBIO.net
And I am sitting down with legislative leadership now along with our hospitals to restart a more collaborative conversation with our hospitals about their role in ensuring Connecticut’s physical health and fiscal health.
But we all know that workforce development can’t happen without our state’s working families.
Many households in the 21st century have either two working parents or a single parent, juggling multiple responsibilities, including caring for infants or the elderly.
A $15 minimum wage, enacted responsibly and over time would raise wages for almost a third of our workforce, a third of whom are female workers, forty percent are African-American – half are Hispanic – let’s give them a shot!
And passing – while I’m at it – passing a Paid Family and Medical Leave program will ensure that workers –
[APPLAUSE AND YELLING]
That will ensure that workers who need time off for a new baby or recover from illness are not punished financially, and businesses do not risk losing good workers due to these emergencies.
My budget also supports fully funding our clean energy and energy efficiency programs.
They have been shortchanged over the last few years. These funds help bring down electricity costs for working families, and they further reduce our carbon footprint.
And I will make sure that we work with labor and vo-tech schools so that more of our citizens – young and not so young – get the skills training they need for these good paying, green collar jobs.
Alright so in addition to bringing our workplace and workforce into the 21st century – we must bring our transportation system into the 21st century.
By – that’s the easy part.
We do that by speeding up our highways and rail service, which are a critical to long-term economic growth of this state.
Okay! This is a budget address: Now, we gotta talk about how we pay for it.
Let me say this to everyone:
People in this state are getting squeezed, the middle-class is getting hammered!
I saw that everyday during the campaign!
I see that everyday as your Governor.
I know this idea of tolling just sounds like one more damn tax I’m going to have to pay!
And I can not fix this state unless I fix our transportation system.
And let me tell you how I plan to do it –
By now, you’ve heard I’m submitting more than one option when it comes to tolling – tolling for truck-only and tolling for trucks as well as cars!
And I’ve asked Transportation Commissioner Joe Giulietti in either case – to make that we are streamlining the administrative and construction costs per mile, and we will explore public-private partnerships to maximize the value of these new revenue streams.
In these partnerships, I will ensure that the public side doesn’t carry the downside rut – risk while the private investors enjoy the upside.
We’re gonna get this done.
I’ve supported as you know – truck-toll – truck only tolling which we thought could generate probably $200 million dollars a year – measured off the Rhode Island example.
And if applied to all of Connecticut’s major highways – it would.
But while we are waiting the final ruling out of the Rhode Island case our attorneys are saying probably in all likelihood – if they allow truck-only tolling – it will be only tolling on those bridges that are being rebuild.
Assuming that is correct – truck-only tolling could provide a small down payment on repairing our roads and bridges, but not nearly enough to rebuild our transportation system and certainly not without additional revenues.
So let me be clear – I do not support raising the gasoline tax as an additional revenue.
And some of you have suggested that how about we use something like “priority bonding.” I don’t like that idea, it runs counter to our debt diet – and after 40 years of underinvesting in our transportation system, we cannot borrow our way out of this mess.
Alright so I know there are proposals in the legislature that call for tolling of cars and trucks.
And I would only consider this option, if we maximized the discount for Connecticut EZ-Pass users and offer a “frequent driver” discount for those who require a frequent use of our major roadways.
And by the way – it is estimated that out-of-state drivers could provide over 40% of tolling revenue would come from out of staters.
We foot the bill when we travel through neighboring states, it’s time for those out-of-state drivers to help foot the bill for help fixing our roads and bridges.
Alright you’re the co-equal branch of government, I am open to a real discussion with you, as well as Connecticut’s drivers, about the state of our transportation system and what will be needed going forward – not only to make repairs, but to truly put Connecticut on the path to speedier transportation. If the situation weren’t as dire as it is, we wouldn’t be having this conversation. And we got to do it.
Speeding up our rail service from Hartford – New Haven – Stamford to New York City with more frequent service, to Waterbury and New London, with easier access to Bradley Airport and an upgraded Tweed Airport – working collaboratively with the neighbors there – to make sure it benefits everyone – all while moving some drivers from roads to rail, incentivizing trucks to go off peak – these transportation upgrades are the building blocks of our economic future— and they have to start now.
I recently announced a revitalized economic development team, and the first question they will be asked by employers thinking about expanding here in the state or moving here in Connecticut – they ask:
“I hear your transportation system is in gridlock, how are addressing that?”
And rather than nervously looking down at their shoes or checking their watch, our economic development team will now be able to say:
“I’m glad you asked me that.”
“How about those unfunded liabilities and deficits?” Our team will soon be able to answer, “I am glad you asked for that”
“How will you make sure you have the workforce we need to grow and expand?” “I’m glad you asked me that.”
And beyond this two-year budget, we must enact new sources of revenues, such as sports betting and internet wagering.
Legalize recreational marijuana like our neighbors that will be carefully regulated with safer market with tax.
Young guys are standing up!
And by year three we will see more savings from our investment in new digital systems and online delivery – these are the building blocks of a balanced budget in the future.
In the meantime:
[Ned Lamont:] Source: LYBIO.net
This current budget keeps faith with our cities, but not at the expense of our towns.
It maintains our commitment to education and provides property tax relief.
It’s a budget that tackles our long-term fixed costs head on and asks all stakeholders to be part of the solution.
It’s a budget that focuses on a on 21st century workforce and economy and transportation system which reminds business why they want to be here in Connecticut.
And it’s a budget that supports businesses and working families alike. It’s a budget that presents a path forward for our great state.
And it does all this without raising tax rates on income or sales.
But imagine what we could do if we get this state growing again.
Look, I have been an entrepreneur all my life, we start businesses – we grow the top line – we expand – increasing the top line allows us to do more and dream big.
And together we can turn this fiscal challenge – turn it on its head and use it as a wake-up call to jump start our economy – an economy that works for everyone, that grows the revenues we need to continue investing in our amazing future.
Alright – last month I came before you – I think I am a straight shooter, I think I’m an honest broker – I think I am a pretty good listener and the budget I have proposed is far from perfect and I welcome your input.
Politics in Washington DC right now is a dysfunctional mess. Let’s show that here in Connecticut, we can work together on an honest budget, on time, one that gets our state moving again. And when we disagree, you don’t go to a microphone, come to my office. Let’s talk. The door is always open. Let’s get it done.
Thank you. Thank you, thank you.
Looks it’s tough! It’s going to be tough!
But we’re going to do this together. It’s going to be a budget that’s on time, you know – A budget, on time, borne on a chilly February afternoon, they’ve completed in time – on a warm spring day – why not?
Certainly in time for most of our mayors and first selectmen, our superintendents,small businesses and all of our citizens alike to plan for a fresh start. Now let’s get to work.
Thank you all.
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Governor Ned Lamont First State 2019 Budget Address Speech. Legalize recreational marijuana like our neighbors that will be carefully regulated with safer market with tax. Complete Full Transcript, Dialogue, Remarks, Saying, Quotes, Words And Text.