Governor Malloy announces new state budget plan

HARTFORD, Conn. (WTNH)– The state budget is sinking in red ink. On Monday, Governor Malloy outlined his latest plan to keep it afloat.

The current budget has a deficit of about $390 million. The state is planning on emptying its piggy bank. The entire rainy day fund will be spent to plug that hole, but it’s not enough. The state usually sends aid checks to the 169 cities and towns.

Related: Malloy to unveil revised budget plan covering bigger deficit

Governor Malloy announced Monday afternoon that’s not going to happen this year. That will save the state $19 million. Your local town might have to change its budget or raise property taxes to make up that difference.

Related Contnet: Governor Malloy’s Revised Recommended Budget for the Fiscal Year 2018-2019 Biennium

Smaller towns will lose a few thousand dollars. Bigger cities like New Haven will lose a couple million. None of this helps out the even bigger problem of the $5 billion projected deficit for the next two-year budget. On Friday, the top democrat in the Senate would not rule out hikes in income tax or sales tax.

“That would foreclose debate give and take. We are going to be interacting with the Governor and with our Republican colleagues so nothing is either on the table or off the table for sure,” said Senate Democratic leader Martin Looney.

So tax hikes are still a possibility. Highway tolls are not off the table, either. Both sides of the aisle are hoping to get major concessions out of the state labor unions, maybe as much as $700 million.

Related: Malloy: layoffs begun, legislative leaders don’t want to do hard things

In an effort to reduce spending, the state has already sent out the first round of pink slips. Due to legal obligations under the collective bargaining agreements, we don’t know much about who was let go, but the Governor assures us, many more layoffs are coming, unless the unions can reach a deal with the state.

Still a lot more to do on the budget that starts July first, but first we have to figure out the hole in this year’s budget, and Monday, we hear from Governor Malloy about his proposal.

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