With Connecticut facing a projected budget deficit of $3.6 billion over the 2018 and 2019 fiscal years, the state needs to make adjustments to close the gap. As such, Governor Dannel Malloy has proposed a budget for those two years to eliminate the deficit, primarily through spending cuts.
Still, the question remains how the state legislature will act, and the business community has an opportunity to have a voice in these budget discussions as well as regarding the overall business climate in the state.
In particular, the business community will be able to discuss these issues with lawmakers by attending Connecticut Business Day at the Legislative Office Building in Hartford on March 8 from 10 a.m. to 12 p.m. The event is free to attend and sponsored by the Connecticut Business & Industry Association and the Connecticut Association of Chamber of Commerce Executives.
During Connecticut Business Day, the governor will address attendees, and the business community will be able to meet with lawmakers from both sides of the aisle at the State Capitol to discuss how to make Connecticut more competitive for business.
What Does the Budget Mean for Businesses?
Given that the Governor’s proposed budget relies primarily on spending cuts rather than large tax increases, the CBIA generally views the plan as a positive.
“[C]losing a multi-billion dollar budget gap without having these broad-based tax increases we saw in 2011 and 2015 sends a really good message,” said Joe Brennan, CBIA’s president and CEO.
The proposed budget also includes lowering the tax on insurance premiums from 1.75% to 1.5%, which the Governor says will help improve the business climate.
Connecticut has the largest insurance industry in the nation in terms of employment as a percentage of total state employment, and 9% of the country’s life, health, property and casualty insurers are chartered, incorporated, organized or constituted in the state, according to The New England Council. So measures like this tax cut could have a large impact on Connecticut’s economy.
In other cases, however, CBIA is still concerned and keeping a close eye on taxes, such as how the proposed budget includes removing a $200 property tax credit.
What Can Businesses Do on Their Own?
While it’s important for businesses to have a say in state policy, it’s important to not just respond to what’s in the proposed budget, but also work on their own terms to increase competitiveness and bring ideas to the legislature on how to make that more feasible.
For example, certain areas like Hartford are seeing a flourish of entrepreneurship, and these innovators are working in coordination with government such as through grants. Additionally, businesses are increasingly making use of analytics to drive businesses decisions, so there is potential to discuss this trend with lawmakers and look for ways to make Connecticut more attractive for businesses pioneering data initiatives.
Energy policy is also an important issue, as Connecticut electricity rates are among the highest in the nation, while the state government pursues energy efficiency programs. Businesses can both lower energy costs while increasing energy efficiency through the use of energy analytics software (EAS), and business owners might want to discuss how the state will support companies in this regard.
In order for Connecticut businesses to have an impact on making their own companies along with state’s economy more competitive, it is important that they voice their views when possible, and Connecticut Business Day offers a prime opportunity to do so.
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