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BUDGET: Spending Cuts, Tax Hikes … See Who (and What) Malloy’s Budget Affects (UPDATED)

February 8, 2017 By Staff
BUDGET: Spending Cuts, Tax Hikes … See Who (and What) Malloy’s Budget Affects (UPDATED)

Gov. Dan Malloy (D-Conn.) released his budget proposal on Wednesday; the budget takes a number of steps to close a projected $1.7 billion deficit in the next fiscal year.

See our breakdown of Gov. Dan Malloy’s (D-Conn.) budget, based on early reports from Connecticut outlets. Malloy is attempting to close a $1.7 billion budget deficit.


Total revenue changes: $320 million (source: 2018-19 Biennial Budget)

  • Malloy eliminates a property tax credit that nearly one in four residents benefits from (which makes the state $105 million a year; source: CT Mirror, Reclaim Connecticut)
  • $60 million in new cigarette taxes (source: CT Mirror)
  • Gun owners will pay more for their pistol permit fees and initial five-year fees (source: CT News Junkie)

Examples of tax cuts in the budget:

NOTE: Malloy’s teacher pension change (above) may compel some towns and cities to increase property taxes, and his plan to allow towns and cities to “tax hospital properties for the first time” will have an impact on those hospitals.


Total spending cuts: $1.36 billion (source: 2018-19 Biennial Budget)

  • “[I]ncludes $700 million in assumed labor savings” (source: Courant); if labor unions don’t agree to concessions, Malloy could layoff 10% of the workforce (source: Courant‘s Daniela Altimari)
  • Includes “$400 million in a cost-shift to cities and towns so that the municipalities would help pay for the pensions of local teachers” (sources: Courant, Reclaim Connecticut)
  • $256 million in other cuts (source: CT Mirror‘s Arielle Levin Becker)
    • 137 of 169 towns and cities in Connecticut will lose state aid; eleven towns and cities – including Hartford ($47.3M), Waterbury ($43M), New Britain ($28.2M), Bridgeport ($19.1M), and New Haven ($16.6M) will gain state aid (source: CT Mirror)
    • The block grant for higher education in Connecticut is cut by 4.3% (source: CT News JunkieOffice of Governor Malloy)

Examples of other spending changes in the budget:

  • $250 million in “new supplemental payments to hospitals” to make up for expected increases in local taxes on hospitals (see above under “NOTE“; source: Office of Governor Malloy)
  • $75 million “in undistributed funding” to towns and cities; the legislature can decide where that money goes (source: Office of Governor Malloy)

We will update this post as we receive more information.