Over four months late, but we finally have a state budget!
Typically, our legislature will pass a two-year balanced budget prior to the legislative session ending, which this year was back in June. On October 26th, CT became the last state in the nation to do so, with a budget that spends just over $41B, effectively closing a $3.5B deficit.
As is the case with most state budgets, there are winners and losers. The “winners,” among others, include the city of Hartford which received funding to help prevent it from filing for bankruptcy. Low to moderate income retirees also benefited as the state lowered income tax on social security income and pension income. The budget also provides aid to help homeowners impacted by crumbling foundations in Eastern CT.
Among the “losers” are those who rely on Medicaid. The budget includes severe eligibility reductions, including program cuts to HUSKY A, the Medicare Savings Program, and the loss of adult dental coverage. These cuts impact 77,500 low-income parents, seniors and persons with disabilities. Also lost is the reduction of the Earned Income Tax Credit, which represents a $90M tax increase for working and middle-class families.
Despite finally having a budget, CT is now predicted to end the current fiscal year with yet another deficit. According to Comptroller Kevin Lembo, based on CT’s revenue and spending through September 30th, CT is on track to end the fiscal year with a $94M deficit. This will almost definitely mean more budget cuts in our future, as well as a need to identify new revenue moving forward.