Democratic Response to Call for Special Session on Taxes

Editor’s Note: Stratford’s Democratic State Representatives Response to the State Representative Ben McGorty, (R) 122nd Connecticut House District Letter to the Editor

State Representative Joe Gresko, (D)

121st Connecticut House District

While it’s a good conversation to have, which taxes to reduce/remove, a special session now is more political than practical.

Having inherited large pension debts and budget shortfalls from our legislative and executive predecessors on both sides of the aisle, Connecticut needs a consistently stable and sustainable budget, not the rollercoaster we’ve experienced over the decades.

This year, the legislature passed a two-year budget including some $670 million in tax cuts.  In Stratford, you’ll receive the property tax credit of $300 on your state income tax again, the tax on your vehicle will be on 32.46 mills rather than 39.46 mills (with the state making up the difference to the town), the Earned Income Tax Credit (EITC) will be raised and you can apply for a child tax credit. (All within income qualifications)  I specifically worked on removing the sales tax from your Aquarian water bill, which will happen at the next ratepayer docket before PURA. Those are responsible, sustainable tax cuts.

I look forward to working to remove the one percent surcharge on prepared foods next session, as the Governor indicated he would support.

However, to take away any annual surplus funds and raid our “Rainy Day” fund now only to say we have to raise taxes in a few years because of a shortfall…taxpayers experienced the $50 rebate check from Governor Rowland years ago, only to see taxes rise soon thereafter.

It makes sense to cut the one percent surcharge, more than cutting the truck taxes, because the cut is sustainable.  Current national inflation hurts, no question, especially fuel costs.   The legislature heard you and we suspended the state’s gas tax to attempt to ease the burden.

Unfortunately, the Russian invasion of Ukraine and shareholder profits have quickly brought us to record high prices.  The call for a reduction in the state’s diesel fuel tax, which is based on a formula heavily weighing on the wholesale price, which we cannot control, and elimination of the yet-to happen highway use tax on heavy trucks — the effect is not as large as some claim and is paid by mostly out-of-state companies.

Connecticut consumers are already paying for trucks going through tolls in New York, New Jersey, Massachusetts, Rhode Island, etc… So why not collect our fair share?

Connecticut needs to prepare for a recession according to most economists, and that means the state budget will take a hit.  We have a $3.1 billion rainy-day fund, but odds are we won’t see these surpluses in the next several years.  So either we’ll have to cut spending or raise those taxes back to where they are today.   The rollercoaster again without preparation.

I enjoyed working with my colleagues across the aisle in 2018 to establish a revenue cap and volatility cap, so our surplus funds are used to pay down our unfunded pension liabilities. (The state has paid an extra $5.2 billion)   Let’s keep that up and let the rating agencies continue to improve our credit rating, increase the percentage of funded pensions and free up more money every year that would’ve gone to interest payments. Steady progress.

State Representative Phil Young (D)

120th Connecticut House District

Joe’s response is quite detailed and written very well. I’m going to give another narrative that will overlap Joe but try not to be too redundant.

The tax cuts that were initiated this spring were done with targeting the thought that we need to touch all of our constituents fairly. Just because there is a surplus now doesn’t mean there will be tomorrow. Short term thinking is what got us into a fiscal mess. Here are the specific cuts, to whom it helps.

  1. Seniors, the removal if income tax on social security benefits, retirement income etc. for those under $75,000.
  2. Middle class, property tax credit, lowering local property taxes on cars.
  3. Parents, increase in the Earned Income Tax Credit, child tax credit of $300 each. (The largest single tax cut in state history).
  4. The underprivileged, mostly our essential workers will have free bus services for the rest of the year, along with the other benefits.
  5. Our children, I go as far as to say probably the biggest so I’ll give a narrative.

Pension debt. In the last 11 months and two budgets the state has paid off nearly

12.5% of our total debt. That is a staggering amount, “never been seen before”.

Immediately our bond rating went from stable to positive, an unbelievable savings in loan interest. I suggest it is the biggest tax break, not to us now… but our children will not have to pay that debt. That’s called smart investing, one time tax decreases are what got us in this mess, I’m looking to make sure the folks are in better shape in the future, long after I’m gone. I wish I had that situation when I was first elected.

Some of these measures are helpful for all, but no one recipient is favored. That’s called fair, smart, good business and a pound wise. The Republicans know a special session won’t happen, it’s like herding cats this time of year. Joe knows the truck/diesel issue more than I, so I trust his judgment.

If you want to know about the investments mental health, addiction services and education that the legislature made serious investments in…we will need a few hours.

With inflation now, and a potential recession coming. we need thoughtfulness and steady leadership.

Just cutting taxes because you can is good during a campaign season but when the session starts next year, sober and rational thoughts will dominate. Remember four years ago when Stephenowski said he’d eliminate the income tax, yeah he kind a took that back because he learned. Campaign rhetoric is great; thank goodness, there are still some adults in the room!

Thank you,

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