Many criticize Connecticut’s fiscal “guardrails,” which are the mainstay of the 2017 bipartisan budget. These critics attempt to recreate the history, purpose, and thoughtful implementation strategy and create a false narrative to weaken them. The guardrails were designed to last. They were not a stop-gap measure.
The criticism demonstrates a lack of understanding of the intent of the budget. Statements such as “the guardrails have outlived their stated purpose” only underscore an incomprehension of the guardrails and ignore the budgeting history.
2025 CT legislative session starts Wednesday. Here are the top issues residents should know about.
The political timing of the 2017 budget may never be repeated in Connecticut’s history. The Senate was tied, with 18 Republicans and 18 Democrats. The House of Representatives numbers were close. The Democratic budget was moved from the House to the Senate, which allowed four courageous Democratic senators who recognized the historic moment for structural budgetary changes. Their influence should not be understated. The governor was eliminated from the budget process. The most crucial factor was the close and trusting relationship the legislative leaders had with one another.
Some pundits have erroneously stated that the 2017 budget was put together in haste, which ignores the fact that the leaders met nearly every day for nine months. The 2017 budget was the culmination of in-depth policy conversations and long-term budget safeguards to protect the state from past fiscal disasters. The budget’s primary purpose was to create structural changes in the budgeting process. Just listen to the floor speeches.
The legislative leaders knew permanent safeguards were essential for the creation of future budgets, requiring future legislatures to think differently about the state budget. Past budgets consisted of a roller coaster of surpluses followed by historic deficits. The result was the uncertainty of a taxing structure, the elimination or reduction of funds to vital programs, and uncertainty regarding municipal and education funding. Even worse, those budgets pretended to balance and then six months later a budget deficit mitigation plan had to be adopted.
The 2017 budget is about safeguards. For example, it only allows for spending a certain percentage of the income based on the prior year. This provision protects against insatiable spending of every taxpayer dime. Recently, that safeguard prevented a deficit when the current income fell short of projections.
Another safeguard is the volatility cap, a genius idea that has significantly helped to reduce our state’s debt. The volatility cap is working as planned and will, over time, prove even more beneficial to this State.
Politicians can always find a rationalization to spend taxpayer money on an unending list of needy programs coupled with a self-congratulatory press release. It is the nature of the beast. As leaders, we recognize there is a lack of discipline to control that behavior. The 2017 budget established a structure to prevent repeated wild spending of the past. It allows leadership to say “no” and blame the Budget. The Budget requires the legislature to make choices when they create a budget.
The critics argue that billions of dollars are out of reach for necessary programs. That is true, but we also have over $30 billion in debt we created after years of neglect and poor fiscal planning.
Critics of the 2017 budget also argue there is not enough money to adequately provide for basic services like education, healthcare, social services, and town aid. These critics want us to reduce our debt payments in favor of spending more money. They present a false choice of removing the guardrails or failing to fund numerous services.
But there is another choice. The legislature can take a more cerebral path. The budget guardrails prohibit overspending in favor of significantly decreasing our state debt. They require the legislature to work within the budget resources. It can be done if there is a will.
It’s about priorities. There are short-term and long-term solutions to the issues raised by the critics, and they still comply with the 2017 budget. A short-term solution requires the removal and combination of duplicative programs. This strategy will increase efficiency and reduce costs, allowing these resources to be diverted to other programs.
An example is the programs that prepare people to leave correctional institutions for gainful employment. These programs exist in the correctional, educational, and judiciary budgets. There are also worthy programs dotted throughout our budget to aid those who need valuable services. The legislature can conduct a detailed review to measure the success of these programs, combine them, and consolidate resources. Strong, successful programs are better than multiple programs that dilute resources and fall short of their goals.
A long-term solution is to eliminate the restrictions that trap people in poverty. Remove the economic cliffs that prohibit people from climbing the ladder of success without the risk of losing public resources. Use a sliding scale created by a mathematical formula. Every dollar earned over the current income limits reduces the state subsidy. Over time, this will result in more people fiscally elevating themselves, reducing the State’s subsidy and potentially increasing the state’s revenue.
Other conversations take true courage. The fiscal burden of the state’s defined pension plan has been and will continue to be a considerable burden on our budget. A change to a hybrid-defined pension and contribution plan before 2027 is achievable. A change in the pension plan would unlock significant money for years to come.
The budget guardrails were created to embrace a new budgeting system. We are experiencing another historic moment. A disciplined legislature can make substantive changes to government to benefit all Connecticut residents.
It is not the time to jump the tracks. It is time to hold firm.
Len Fasano is the former Connecticut State Senate Republican Leader
