Residents: Malloy's Proposed Tax Increases 'Unreasonable'

In his first budget address, Gov. Dannel P. Malloy touched upon several areas of the proposed state budget for the next two fiscal years, from local and state education and municipal funding to state employee concessions and increased taxes.

The budget would raise the gasoline tax 3 cents per gallon, to 28 cents a gallon. 

Local residents said raising taxes is unreasonable.

"First of all, I think any taxes in this economy are too much. Any at all," said Jeff Middlesworth, of Groton.  Of the gasoline tax, he added, "Increasing something that's already been a problem is just ludicrous."

"We don't need more revenue. They need to stop spending money. I thought Malloy was going to take care of all this."

"I've already got enough to pay for," said Josh D'Lizarraga, who works two jobs, including one as assistant manger of the Henny Penny on Fort Hill Road in Groton.

He said at this point, he wants the federal government to step in to prevent local governments from raising the gas tax any more. "It's insanity paying this much," he said.

"I think everything is being taxed too much," said Donna VanEyk, a Waterford resident stopped in Groton for gas.  "Taxing gas is like choking you. Gas is a necessity."

For a more detailed breakdown of the budget, view the document here.

For a more general overview, here are some highlights from the governor's address; the budget would:

• Require state employees to accept various concessions or risk the chance of mass layoffs;
• Enact an earned income tax credit of 30 percent for working citizens;
• Create a new incentive for the first five companies "that bring hundreds of new jobs" to the state;
• Consolidate state agencies by 30 percent;
•  Raise the sales tax, the gasoline tax, create various new taxes, and, for some, raise income taxes;
• Maintain municipal grant funding from the state;
• Fill the gap that will be left in state ECS funding when the federal ARRA grant expires in June;
• Provide money for more magnet schools and begin to transfer control of vocational-technical schools from the state to local school districts;
• Convert Medicaid programs to a self-insured model; and
• Improve the state transportation infrastructure.

The Republican leadership has already begun to question Malloy's proposal and are critical of his accounting, his suggestion of raising various taxes and have said that not enough of the spending portion of the budget has been eliminated. To view a YouTube video of House Minority Leader Lawrence Cafero discussing Malloy's proposal on Feb. 15, click here.

Original breaking news:

In a briefing prior to the release of Gov. Dannel P. Malloy’s state budget proposal, Office of Policy and Management Secretary Benjamin Barnes detailed the plan to reporters Wednesday morning.

Faced with filling a projected $3.2 billion deficit in the coming year, Barnes repeatedly touched on the point that Malloy’s budget calls for a number of “shared sacrifices,” but protects local services.

Among the proposals included in Malloy’s recommended budget, which has a “bottom line” total of $17.94 billion for the 2011-12 fiscal year, and spending of $18.37 billion in fiscal year 2012-13, are numerous spending cuts and tax increases, the consolidation of about 30 percent of state agencies, and changes in the state’s revenue structure to eliminate dependence on borrowing or one-time revenue to meet operating expenses.

“Balancing this budget will require shared sacrifices,” Barnes said. “Overall, the budget includes more spending cuts than tax increases.”

Malloy’s proposal includes $1.76 billion in reductions in spending, coupled with $1.51 billion in estimated increases in income, sales and other taxes in the first year of the budget.

The governor's budget also calls for the restoration of $270 million over the next two years to the Education Cost Sharing grant to cities and towns to make up for the anticipated loss of funds from the American Recovery and Reinvestment Act, with is set to expire at the end of June. The federal funding is currently plugging about a 14 percent hole in ECS grants to local municipalities. Barnes said the ECS restoration would restore the state’s funding to the 2009 level.

Malloy’s proposal also relies on about $2 billion in savings and reductions over the next two years - $1 billion each year - from unionized state employees who are already under contract, Barnes said.

When asked how the budget would be balanced if those savings were not realized, Barnes replied: “The spending reductions that the governor has proposed, we intend to accomplish.”