Government Affairs

We update this section as we receive notices from the state and town.

Posted April 1, 2014

From League of Women Voters:

LWV+text

 
 
 
 

Advocacy Alert:  April 5th Anniversary of Historic Gun Violence Prevention Legislation

 

As we approach the April 5th one-year anniversary of the passage of PA 13-3, the bipartisan Gun Violence Prevention and Children's Safety Act, media attention may focus on a rally at the Capitol in Hartford by gun activists seeking to draw attention away from Connecticut's achievements over the past year. We urge our members and friends instead to applaud and support continued progress toward gun violence prevention

 

Tell your legislators to continue work and support the efforts of state agencies, local communities and school districts to Improve Access to Mental and Behavioral Health Services for Connecticut residents and to protect public safety through the reasonable regulation of Accessibility and Ownership of Firearms.

 

There is no basis for claims that the new Gun Violence Prevention Act is unconstitutional.  On Jan. 30, 2014, the U.S. District Court for the District of CT in Shew v. Malloy ended the gun activists' challenge by declaring "The Court concludes that the legislation is constitutional."

 

The new law does not confiscate the firearms of residents who obtain  appropriate permits or certificates.  The law banned high capacity ammunition magazines and strengthened the definition of assault weapons, but it "grandfathered" pre-existing owners, who were allowed to keep their assault weapons and high capacity ammunition magazines but were required to register them with the state by Jan. 1, 2014.  This is a reasonable regulation.

 

Tell Your State Legislators to support continued progress on gun violence prevention and mental health services. Contacting your officials on Friday 4/4, the day before the anniversary, will be particularly helpful in underscoring your support for sensible gun laws. It's easy: 

 

E-mail:  Go to CT General Assembly Website (www.cga.ct.gov) and click on SENATE and HOUSE to find your lawmakers. 

 

Telephone:      

Senate Democrats      (800)  842-1420

Senate Republicans     (800)  842-1421

House Democrats       (800)  842-8267

House Republicans      (800)  842-8270

League of Women Voters of Connecticut | 203-288-7996 | lwvct@lwvct.org | http://www.lwvct.org
1890 Dixwell Avenue
Suite 203
Hamden, CT 06514-3183

 

Posted march 3, 2014

Comptroller Kevin Lembo today announced that the state is currently on track to end Fiscal Year 2014 with a $504.4 million surplus.

In a letter to Gov. Dannel P. Malloy, Lembo said he agrees with the Office of Policy and Management’s (OPM) most recent projection, which is a slight decrease of $1.7 million from last month’s report due to various adjustments to spending projections.

The largest increase in estimated spending is within the judicial branch - however, spending projections remain more than $50 million below initial budget targets.

Revenue, on the other hand, continues to exceed initial budget targets by $421.2 million, Lembo said. The three largest tax categories - income, sales and corporations - are all exceeding initial budget expectations, with the largest in the income tax at $213.1 million. The stock market has continued to post double-digit gains that have fueled the estimated income tax payments, Lembo said.
 
"As you know, I have advocated for the deposit of General Fund surplus dollars to the state's Budget Reserve Fund in accordance with current law,” Lembo said in his letter to Malloy. "I have advocated for a reserve level of 15 percent of spending, which is also endorsed within your surplus distribution plan. Sufficient dollars in reserve will guard against future tax increases and service reductions during inevitable future recessionary cycles.

"As the disposition of the surplus is debated, policy makers should remember that the Fiscal Year 2014 General Fund budget relies on $190.8 million in nonrecurring revenue reserved from the prior year and $112.4 million in carry forward funding. In addition, the majority of the surplus dollars in Fiscal Year 2014 result from a one-time amnesty program, and from the most volatile component of the income tax, which relies on strong stock market performance.

"Finally, both OFA (Office of Fiscal Analysis) and OPM have estimated budget shortfalls beginning in Fiscal Year 2016 if current policies remain unchanged. I recommend that any General Fund surplus realized by the close of Fiscal Year 2014 in excess of this month's estimate be deposited directly to the Budget Reserve Fund."

Lembo said updated employment data will not be available until March 14, but he pointed to several economic indicators worth considering that relate to both the national and state economies -- particularly concerning college graduates and the rate of first-time homebuyers.

“The housing market in Connecticut is an economic bright spot,” Lembo said, noting that the state’s real estate conveyance tax receipts are running 71 percent above the same period last fiscal year. “This resurgence, however, is leaving first-time homebuyers - young adults in their 30s - behind.”

Nationally, first-time homebuyers accounted for 26 percent of purchases in January, down from 27 percent in December, according to the National Association of Realtors. Historically, first time homebuyers have accounted for about 40 percent of home sales (50 percent at their peak in 2009).

The Mortgage Bankers Association has noted that ballooning levels of student debt, which have tripled to more than $1 trillion over the last decade, have had a dampening effect on the ability of young people to save for homes.

The Federal Reserve found that from 2009 to 2012, the homeownership rate fell twice as much for 30-year-olds who had a history of student loans than it did for those without such debt.

“This crisis of crippling student debt imposes significant consequences - not only on an entire generation of struggling young adults – but on all aspects of the Connecticut and national economies,” Lembo said. “These realities - ballooning student debt and deflating first-time homeownership - challenge our traditional belief that a college education presents opportunities to develop wealth and assets. This troubling trend breeds other economic challenges, and deserves our attention.”

David H. Stevens, chief executive of the Mortgage Bankers Association, was recently quoted in The Washington Post: “This is a huge issue for us,” Stevens said in The Washington Post. “Student debt trumps all other consumer debt. It’s going to have an extraordinary dampening effect on young peoples’ ability to borrow for a home, and that’s going to impact the housing market and the economy at large.”
 
In terms of other relevant economic indicators, Lembo highlighted data and other information from federal and state Departments of Labor and other sources that show:
 
• Year-to-date gains in the employment-driven withholding portion of the state income tax have been eroding since October. Total income tax withholding collections through January were up just 0.8 percent over the same period last year. In Fiscal Year 2013, the withholding portion of the income tax declined. These numbers are indicative of the state’s challenging job market.
• State employment data for January will not be released until March 14. According to Department of Labor data, the state lost 3,900 jobs in December. This more than eliminated the 3,800 jobs gained in November.
• In 2013, the state posted eight months of job gains and four months of job losses. Nationally, job gains occurred in every month of 2013. The national rate of job growth in 2013 was more than double Connecticut’s rate of growth.
• For the 12-month period ending in December, Connecticut added 11,500 payroll positions. Job growth in 2013 averaged 958 positions per month; in 2012, job additions averaged 717 positions per month. Through the end of 2013, Connecticut had recovered 59,400 positions, or 49 percent of the 121,200 seasonally adjusted total nonfarm jobs that were lost in the March 2008 - February 2010 employment recession. Listed below is a table provided by the Department of Labor showing sector gains and losses for 2013.
Connecticut’s Ten Industry Supersector Performance (YTD December 2013: 5 up, 5 down, before revisions)
1.)     Education and Health Services (7,900, 2.5%)  6.) Information (-600, -1.9%)
2.)     Construction and Mining (5,800, 11.4%, combined) 7.) Government (-1,300, -0.5%)
3.)     Trade, Transportation, and Utilities (4,200, 1.4%) 8.) Financial Activities (-1,300, -1.0%)
4.)     Professional and Business Services (1,400, 0.7%) 9.) Other Services (-1,400, -2.2%)
5.)     Leisure and Hospitality (800, 0.6%)   10.) Manufacturing (-4,000, -2.5%)
• Nationally employment numbers were disappointing in both December and January with the addition of 75,000 and 113,000 jobs in the respective months. This followed strong employment growth in October and November. November was notable with a gain of 274,000 payroll jobs.
• Connecticut’s unemployment rate in December stood at 7.4 percent. This compares to a national rate of 6.6 percent.

 
 
• Personal income in Connecticut grew at a rate of 0.8 percent between the second and third quarters of 2013. This ranked Connecticut 37th nationally in income growth. On a full year basis, growth was 3.5 percent. For calendar year 2012, Connecticut personal income advanced at a 3.4 percent rate. Data for the fourth quarter will be released on March 25.
• The chart below shows the annual trend in Connecticut personal income, updated by the Bureau of Economic Analysis on September 30, 2013. Because the state spending cap is based on the growth in personal income (or inflation if higher), the current trend places downward pressure on budgeted state spending. The cap does not apply to debt-financed spending.

 

• Average hourly earnings at $28.00, not seasonally adjusted, were down 31 cents, or -1.1 percent from the December 2012 hourly private sector pay estimate. The resulting average private sector weekly pay was calculated at $940.80, down $27.40, or -2.8 percent over the year.
• The year-to-year change in the Consumer Price Index for All Urban Consumers (CPI-U, U.S. City Average) in December 2013 was 1.5 percent.
         
• A strong housing market has lifted Connecticut’s real estate conveyance tax receipts. Through January, total receipts are running 71 percent above the same period last fiscal year.
• According to a report from Berkshire Hathaway Home Services, there were 28,058 single family home sales in Connecticut in 2013, 12.3 percent higher than the number of sales in 2012 and totaling $11.4 billion in sales volume, one of the best years since 2006. At the same time, condominium closings totaled 7,174 up 19.8 percent. Growth in home sales was strongest in Fairfield, Litchfield, Hartford, Windham and New London Counties.
• Median price increased 2.8 percent to $255,000 for single family properties and up 3.4 percent to $167,000 for condominiums. New Haven County median prices grew the most with a 4.3 percent change in single families and Litchfield grew 17 percent in condominiums.
• Connecticut’s foreclosure activity rate stands at 3.5 percent, the percentage of all mortgaged homes in some sort of legal action, according to data collecting company CoreLogic. This ranks the State in 5th place in the United States, tied with the State of Maine, for highest percentage of foreclosure inventory as a percent of all mortgaged homes. Lowering foreclosure inventories will help the real estate market improve.
• Nationally, existing home sales fell 5.1 percent in January from a year ago-- their lowest level in 18 months. Home prices remained strong up 10.7 percent due to a low inventory of homes for sale. Weather played a significant role in slowing sales growth in January. 
• As discussed earlier above, first-time buyers accounted for 26 percent of purchases in January, down from 27 percent in December. Historically, first-time home buyers have accounted for about 40 percent of home sales. That number peaked at just over 50 percent in 2009.
• Regionally, existing-home sales in the Northeast declined 3.1 percent to an annual rate of 620,000 in January, and are also 3.1 percent below January 2013. The median price in the Northeast was $241,100, up 6.6 percent from a year ago.

 
• The estimated payment portion of the income tax grew by almost 25% through January of last fiscal year. This large increase was partially attributable to a capital gains tax change, effective at the end of 2012, and resulted in a roll-forward of taxable gains to Fiscal Year 2013. Absent the tax change, these roll-forward gains would have been realized in future years. The budget plan anticipated a softening of estimated payments in Fiscal Year 2014 based on the roll-forward activity. However, estimated payments through January of this fiscal year are up by more than 5.1 percent.
• Estimated payments are impacted by market gains and losses. Although the stock market has experienced some volatility recently over the past several weeks, at this writing the Dow continues to post double digit gains for the year.

DOW:

 Consumers

• Through January the sales tax was advancing at a 7.3 percent rate on a fiscal year to date basis. This follows year-to-date growth of just 1.6 percent through November.
• In January, advance retail sales were up 2.6 percent from one year ago. For the full calendar year 2013, sales were 4.2 percent higher than in 2012. The slow growth in January is partially attributable to the winter storms. That rate of increase in car sales was cut roughly in half dropping to 4.1 percent. The strongest January gain was in non-store retailers with growth of 6.5 percent. Department stores continued to post disappointing results.
• According to the Federal Reserve, in December consumer credit increased at an annualized rate of 7.3 percent. This is the strongest rate of growth in the last five years. December’s growth in credit card debt was especially strong, growing 7 percent on an annualized basis.
• The consumer confidence index has been fluctuating. After declining sharply in October and falling again in November, the index rebounded in December and January. However, the index fell again in February as a more pessimistic outlook for the economy and jobs was recorded. Most forecasters had expected a continued rise in the index.  
Business and Economic Growth

• Based on the Feb. 28 release by the Bureau of Economic Analysis, real GDP increased at a rate 2.4 percent in the 4th quarter of 2013. This is down from the advance 4th quarter estimate of 3.2 percent. Growth in the 3rd quarter was 4.1 percent. The deceleration in real GDP in the fourth quarter reflected a deceleration in private inventory investment, a larger decrease in federal government spending, a downturn in residential fixed investment, and decelerations in state and local government spending and in nonresidential fixed investment that were partly offset by accelerations in exports and in personal consumption expenditures and a deceleration in imports.
• Corporate profits posted growth of 5.7 percent from one year ago in the 3nd quarter of 2012. Profits grew by better than 7 percent in both 2011 and 2012. Fourth quarter profits will be reported on March 27.
• The Department of Labor’s General Drift Indicators are composite measures of the four-quarter change in three coincident (Connecticut Manufacturing Production Index, nonfarm employment, and real personal income) and four leading (housing permits, manufacturing average weekly hours, Hartford help-wanted advertising, and initial unemployment claims) economic variables, and are indexed so 1986 = 100.

 ***END***

Posted Feb 3, 2014 from State of CT Comptroller

Comptroller Kevin Lembo today announced that the state’s outlook for Fiscal Year 2014 continues to grow positive with a current projected surplus of $506.1 million - an increase of $232.9 million over last month.

In a letter to Gov. Dannel P. Malloy, Lembo said he agrees with the Office of Policy and Management’s (OPM) latest projection, which incorporates the latest Jan. 15 consensus revenue estimates. The consensus forecast has increased anticipated income tax receipts by $213.1 million.

Lembo commended Malloy's recently announced plan to direct significant portions of the current projected surplus towards the Budget Reserve Fund and to pay down debt.
"As you know, I have advocated for the deposit of General Fund surplus dollars to the state’s Budget Reserve Fund in accordance with current law," Lembo wrote to Malloy.

The reserve balance at the end of Fiscal Year 2013 was $270.7 million – representing 1.6 percent of net appropriations. Should the legislature enact Malloy’s plan, an additional $250 million would be deposited to the Budget Reserve Fund, bringing the balance to $520.7 million or just over 3 percent of planned spending.

"I have advocated for a reserve level of 15 percent of spending, which is also endorsed within your surplus distribution plan," Lembo wrote. "Significant dollars in reserve will guard against future tax increases and service reductions during inevitable future recessionary cycles.

Lembo urged that any additional surplus realized by the end of the fiscal year also be directed to the Budget Reserve Fund.

"As the disposition of the surplus is debated, policy makers should remember that the Fiscal Year 2014 General Fund budget relies on $190.8 million in nonrecurring revenue reserved from the prior year and $112.4 million in carry forward funding,” Lembo said. “In addition, the majority of the surplus dollars in Fiscal Year 2014 result from a one-time tax amnesty program, and from the most volatile component of the income tax, which relies on strong stock market performance. Finally, both OFA (Office of Fiscal Analysis) and OPM have estimated budget shortfalls beginning in Fiscal Year 2016 if current policies remain unchanged.

"I recommend that any General Fund surplus realized by the close of Fiscal Year 2014 in excess of this month’s estimate be deposited directly to the Budget Reserve Fund.'

Lembo reported that the estimated payment portion of the income tax is driving the higher income tax projection. Estimated payments grew by almost 25 percent through January of last fiscal year. This large increase was partially attributable to a capital gains tax change that went into effect at the end of calendar year 2012 and resulted in a roll-forward of taxable gains to Fiscal Year 2013. Absent the tax change, these roll-forward gains would have been realized in future years.

The current budget plan anticipated a softening of estimated payments in Fiscal Year 2014, based on the roll-forward activity. However, estimated payments through January of this fiscal year continued to post year-over-year growth in excess of 4.5 percent. This positive performance in the estimated payment component of the income tax is expected to continue through Fiscal Year 2014.

Total General Fund revenue for 2014 is expected to exceed initial budget targets by $421.2 million. In addition, the stock market has continued to post double-digit gains that continue to lift estimated income tax payments as discussed above.

All major revenue categories are exceeding or are close to original estimates, and spending projections are below initial budget targets, Lembo said.

Data and other information from federal and state Departments of Labor and other sources show:

 

• The employment-driven withholding portion of the state income tax is up 1.5 percent on a fiscal year-to-date basis through December. Last fiscal year the withholding portion of the income tax posted a decline. 
• According to Department of Labor data, the state lost 3,900 jobs in December. This more than eliminated the 3,800 jobs gained in November. In 2013, the state posted eight months of job gains and four months of job losses. Nationally, job gains occurred in every month of 2013. The national rate of job growth in 2013 was more than double Connecticut’s growth rate.
• For the 12-month period ending in December, Connecticut added 11,500 payroll positions. Job growth in 2013 averaged 958 positions per month; in 2012, job additions averaged 717 positions per month. Connecticut has now recovered 59,400 positions, or 49.0 percent of the 121,200 seasonally adjusted total nonfarm jobs that were lost in the state in the March 2008 - February 2010 employment recession. Listed below is a table provided by the Department of Labor showing sector gains and losses for 2013.
Connecticut’s Ten Industry Supersector Performance (YTD December 2013: 5 up, 5 down, before revisions)
1.)     Education and Health Services (7,900, 2.5%)  6.) Information (-600, -1.9%)
2.)     Construction and Mining (5,800, 11.4%, combined) 7.) Government (-1,300, -0.5%)
3.)     Trade, Transportation, and Utilities (4,200, 1.4%) 8.) Financial Activities (-1,300, -1.0%)
4.)     Professional and Business Services (1,400, 0.7%) 9.) Other Services (-1,400, -2.2%)
5.)     Leisure and Hospitality (800, 0.6%)   10.) Manufacturing (-4,000, -2.5%)
• Connecticut’s unemployment rate in December stood at 7.4 percent. This compares to a national rate of 6.7 percent.

 
 

 
• Personal income in Connecticut grew at a rate of 0.8 percent between the second and third quarters of 2013. This ranked Connecticut 37th nationally in income growth. On a full year basis, growth was 3.5 percent. For calendar year 2012, Connecticut personal income advanced at a 3.4-percent rate. Data for the fourth quarter will be released on March 25.
• Average hourly earnings at $28.00, not seasonally adjusted, were down 31 cents, or -1.1 percent from the December 2012 hourly private sector pay estimate. The resulting average private sector weekly pay was calculated at $940.80, down $27.40, or -2.8 percent over the year.
• The year-to-year change in the Consumer Price Index for All Urban Consumers (CPI-U, U.S. City Average) in December 2013 was 1.5 percent.
         
• A strong housing market has lifted Connecticut’s real estate conveyance tax receipts by almost double the amount posted through December of last fiscal year.
• According to a report from Berkshire Hathaway Home Services, there were 28,058 single family home sales in Connecticut in 2013, 12.3 percent higher than the number of sales in 2012 and totaling $11.4 billion in sales volume, one of the best years since 2006. At the same time, condominium closings totaled 7,174 up 19.8 percent. Growth in home sales was strongest in Fairfield, Litchfield, Hartford, Windham and New London Counties.
• Median price increased 2.8 percent to $255,000 for single family properties and up 3.4 percent to $167,000 for condominiums. New Haven County median prices grew the most with a 4.3 percent change in single families and Litchfield grew 17 percent in condominiums.
• Connecticut’s foreclosure activity rate stands at 3.5 percent, the percentage of all mortgaged homes in some sort of legal action, according to data collecting company CoreLogic. This ranks the State in 5th place in the United States tied with the State of Maine for highest percentage of foreclosure inventory as a percent of all mortgaged homes. Lowering foreclosure inventories will help the real estate market improve.
• Nationally, existing home sales in 2013 were at their strongest level since 2006. Sales were up 9.1 percent from a year ago. The national median existing-home price for all of 2013 was $197,100, which is 11.5 percent above the 2012 median of $176,800, and was the strongest gain since 2005 when it rose 12.4 percent.
• First-time buyers accounted for 27 percent of purchases in December, down from 28 percent in November and 30 percent in December 2012.
• Regionally, existing-home sales in the Northeast slipped 1.5 percent to an annual rate of 640,000 in December, but are 3.2 percent higher than December 2012. The median price in the Northeast was $239,300, up 3.6 percent from a year ago.

 
• The estimated payment portion of the income tax grew by almost 25% through January of last fiscal year. This large increase was partially attributable to a capital gains tax change that went into effect at the end of 2012 and resulted in a roll-forward of taxable gains to Fiscal Year 2013. Absent the tax change, these roll-forward gains would have been realized in future years. The budget plan anticipated a softening of estimated payments in Fiscal Year 2014 based on the roll-forward activity. However, estimated payments through January of this fiscal year are up by more than 4.5%.
• Estimated payments are impacted by market gains and losses. Although the stock market has experienced some volatility recently over the past several weeks, at this writing the Dow continues to post double digit gains for the year.
DOW:

 

Consumers

• Through December the sales tax was advancing at a 9.2% rate on a fiscal year to date basis. This follows year-to-date growth of just 1.6% through November.
• In December, advance retail sales were up 4.1 percent from one year ago. For the full calendar year 2013, sales were 4.2 percent higher than in 2012. The strongest gains for 2013 were in the motor vehicle category-- up 8.7 percent, and non-store retailers--up 10.3 percent. Department stores saw a sales decline of 4.7 percent.
• The Conference Board reported that the consumer confidence index, which had decreased sharply in October and declined slightly in November, was up in both December and January. Both business conditions and the job market were rated more favorably.
• According to the Federal Reserve, in November, consumer credit increased at a seasonally adjusted annual rate of 4.8 percent. Revolving credit increased at an annual rate of just 0.6 percent, while non-revolving credit increased at an annual rate of 6.4 percent.

Business and Economic Growth

• Based on the January 30 release by the Bureau of Economic Analysis, real GDP increased at a rate 3.2 percent in the 4th quarter of 2013. This follows growth of 4.1 percent in the 3rd quarter. The deceleration in real GDP in the fourth quarter reflected a deceleration in private inventory investment, a larger decrease in federal government spending, a downturn in residential fixed investment, and decelerations in state and local government spending and in nonresidential fixed investment that were partly offset by accelerations in exports and in personal consumption expenditures and a deceleration in imports.
• Corporate profits posted growth of 5.7 percent from one year ago in the 3nd quarter of 2012. Profits grew by better than 7 percent in both 2011 and 2012. Fourth quarter profits will be reported on March 27.
• The Labor Department’s scorecard of business activity looks at trends in housing permits, air cargo, Connecticut exports, state gaming revenue, visitors to major state attractions, air passengers, the manufacturing index in Connecticut and weekly hours worked in the state in order to gage business health. The index has posted some positive movement toward the end of 2013.

Posted Jan 13, 2014

The US Chamber of Commerce Report Jan 2014

The US Chamber says that according to a Gallup poll, the amount of optimism among small business owners for the new year is broadly similar to what it was two years ago.  Many of them have serious concerns about healthcare, regulations, taxes, and the general state of the economy. If it seems to you like the record is stuck on repeat, you are not alone.

 The U.S. Chamber continues to work on these and many other important issues. In the coming weeks another deadline looms for a spending bill, andTrade Promotion Authority is heating up on the international front.

Posted Jan 2, 2014  Overcrowded highways and roads are a concern of Connecticut businesses respondents  in a  transportation survey. http://www5.cbia.com/newsroom/wp-content/uploads/2013/12/Transportation_13-2.pdf

RECEIVED Dec 16, 2013:

Connecticut’s Minimum Wage Increases

to $8.70 Effective January 1, 2014  WETHERSFIELD, December 13, 2013 – Connecticut’s minimum wage will increase to $8.70 per hour as of January 1, 2014, State Labor Commissioner Sharon Palmer reminds all state residents.  The current minimum wage is $8.25 an hour.

“This increase to $8.70 is the first part of a two-year increase in the minimum wage,” Palmer explains.  “On January 1, 2015, in accordance with Public Act 13-117, Connecticut’s minimum wage will increase to $9.00.”

Although the federal minimum wage is currently $7.25, Connecticut businesses must pay the state minimum wage, emphasizes Gary K. Pechie, Director of the agency’s Division of Wage and Workplace Standards.

Under section 31-60 of the Connecticut General Statutes and Public Act 13-117, the Connecticut minimum wage rate for service employees, specifically restaurant wait staff and bartenders, is determined by using a formula that takes tip deductions into account.  The rates can be found on the Connecticut Department of Labor’s website at www.ct.gov/dol, or by contacting the Labor Department’s Division of Wage and Workplace Standards at (860) 263-6790.

 

RECEIVED Dec 2, 2013

Comptroller Kevin Lembo today announced that - due to increasing state revenue flow and a tax amnesty program -- the state’s financial outlook has continued to improve, positioning the state to end Fiscal Year 2014 with a surplus of $245.9 million.

In a letter to Gov. Dannel P. Malloy, Lembo said that his projection is $110 million above the Office of Policy and Management’s (OPM) earlier projection due to the inclusion of additional revenue from the state’s tax amnesty program that ended Nov. 15.

While the tax amnesty program partly contributed to the state’s improving outlook this year, various sources of tax revenue have also continued to improve, Lembo said. The sales and corporation taxes are each up by $30 million from initial budget targets, and the real estate conveyance tax is $15.6 million over initial estimates.

The Department of Revenue Services estimated that the tax amnesty program resulted in additional revenue in Fiscal Year 2014 in excess of $175 million - exceeding the budget target of $35 million.

“Month after month the state’s financial outlook for the current fiscal year is improving,” Lembo said. “This is a great sign for Connecticut’s economic recovery - but there are also uncertainties and future liabilities that we need to brace for. I strongly recommend that any General Fund surplus amount should be transferred to the state’s Budget Reserve Fund at the close of the current fiscal year.”

The Budget Reserve Fund balance - commonly referred to as the “Rainy Day Fund” – was $270.7 million at the end of Fiscal Year 2013, or 1.6 percent of planned spending.
“I have called for a reserve level of 15 percent of spending - beyond the 10 percent statutory requirement,” Lembo said. “It is essential to the state’s long-term fiscal stability that sufficient reserves be established as soon as possible. Too often in the past, opportunities to build reserves have been missed as other perceived budget priorities were pursued.”

In the chart below, Lembo juxtaposes state surpluses and deficits with Budget Reserve funding levels from Fiscal Years 1991 to recent years. The chart reveals that, since 1990, the General Fund has realized almost $5 billion in revenue windfalls - most of which did not go to build reserves. 

 

“Connecticut would have weathered the 2009 recession far better had we prepared for it by fully funding our Budget Reserve Fund at 15 percent,” Lembo said.

Rebuilding the Budget Reserve Fund with this year’s surplus is imperative in light of mounting future liabilities expected to spike in Fiscal Year 2016, as projected by both the Office of Fiscal Analysis and OPM. Lembo said federal instability and uncertainties could also jeopardize the state’s outlook at any time – including any potential cuts to the defense industry and nonprofits, as well as impacts on Wall Street, and consequently tax receipts from capital gains.

“The bottom line is that Connecticut should use any opportunity now to protect taxpayers from future financial threats and uncertainties,” Lembo said.

As far as economic indicators, information from federal and state Departments of Labor and other sources show:
 
• According to Department of Labor data, the state lost 4,200 jobs through September and October (-4,100 in September, -100 in October). Despite the disappointing job numbers, the withholding portion of the income tax is up by over 3 percent through October. The state’s unemployment rate fell to 7.9 percent, the first time that it has dropped below 8 percent since April of 2009. 
• Over the 12-month period ending in October, Connecticut employment has increased by 10,000 non-farm positions.
 
• According to the Connecticut Department of Labor, the state has recovered 48.6 percent or 58,900 of the 121,200 jobs lost during the recession. Nationally, about 80 percent of recessionary job losses have been recovered.
• The strongest job gains over the past twelve months have been in education and health services (+ 7,200), while the largest losses have occurred in manufacturing (-3,500) and financial activities (-3,400).
 
• Personal income in Connecticut grew at a rate of 0.9 percent between the first and second quarters of 2013. This ranked Connecticut 30th nationally in income growth. On an annualized basis growth was 3.6 percent, which is well above the 1.3 percent growth that was posted for 2012. Data for the third quarter will be released on Dec. 19.
• According to the Department of Labor, average hourly earnings declined 0.8 percent from last October and weekly pay was down 1.9 percent for the same period.
• The year-to-year change in the Consumer Price Index for All Urban Consumers (CPI-U, U.S. City Average) in August 2013 was 1.0 percent.
         
• The number of housing permits issued has shown solid gains over the past two years, but remain well below the peak of 2004-2005.

Below are very helpful contacts for all kinds of situations: where to find a house rental, emergency weather info and more!

Useful Web Resources for Disaster Assistance and Information

There is a wealth of information at the Federal Emergency Management Agency website, www.ready.gov, to help you and your business prepare for, protect against, and recover from future disasters. Included on the site is a comprehensive Business Continuity Planning Suite at www.ready.gov/business-continuity-planning-suite.

The following are some other useful websites:

www.fema.gov provides a general overview of the agency’s programs, types of disaster assistance and links to other important sources of information. For those with a web-enabled mobile device, tablet or smartphone, go to m.fema.gov.

www.ct.gov/demhs/site/default.asp is a link to the Connecticut Division of Emergency Management and Homeland Security website.

www.ct.gov/ctalert/site/default.asp is a link to the Connecticut Emergency Alerting and Notification System where you can sign up for location based emergency email, phone or text alerts.

www.sba.gov/content/disaster-assistance is a link to the U.S. Small Business Administration’s disaster assistance information. The administrator of the SBA has the authority to make an administrative declaration provided the damage meets SBA's criteria in the absence of a FEMA declaration.

www.weather.gov/ is the site of the National Weather Service which provides weather alerts and forecasts.

www.fema.gov/rebuild/recover/dec_guide.shtm describes the process which can lead to a Presidential Disaster Declaration.

www.fema.gov/disaster-assistance-available-fema is a link to sites and information on the types of Individual Assistance available.

www.cthousingsearch.org/Resources.html helps Connecticut residents search available rentals by price and location.

www.disasterassistance.gov/disaster-information/moving-forward/your-homeoffers information and guidance for homeowners rebuilding after a disaster.

www.fema.gov/public-assistance-local-state-tribal-and-non-profit is a link to resources on Public Assistance programs.

Follow us on twitter.com/femaregion1 or www.facebook.com/FEMA. Also, follow Administrator Craig Fugate’s activities at twitter.com/craigatfema

Disaster recovery assistance is available without regard to race, color, religion, nationality, sex, age, disability, English proficiency or economic status. If you or someone you know has been discriminated against, call FEMA toll-free at 800-621-FEMA (3362). For TTY call 800-462-7585.

The U.S. Small Business Administration (SBA) is the federal government’s primary source of money for the long-term rebuilding of disaster-damaged private property. SBA helps homeowners, renters, businesses of all sizes, and private non-profit organizations fund repairs or rebuilding efforts and covers the cost of replacing lost or disaster-damaged personal property. These disaster loans cover losses not fully compensated by insurance or other recoveries and do not duplicate benefits of other agencies or organizations.

FEMA's mission is to support our citizens and first responders to ensure that as a nation we work together to build, sustain, and improve our capability to prepare for, protect against, respond to, recover from, and mitigate all hazards

Sam Palfrey

FEMA External Affairs – Private Sector

Phone 571-732-5588