The Capitol Beat: March 10-14, 2014

From Gaffney, Bennett & Associates

March 10, 2014—March 14, 2014

  • Preliminary 2013 Jobs Figures Look Promising, but Gains Erratic

The state Department of Labor Friday issued Connecticut’s job creation numbers for 2013, and while they are rosier and showed steady gains – 21,000 new private-sector jobs were created last year — the state still lags behind the national recovery and continues to experience some hiccups (e.g. the January jobs report showed a year-over-year decline due to inclement weather).  The national unemployment rate was 6.6 percent in January; Connecticut’s was 7.2 percent. The good news is the numbers overall are following a mostly steady, if not robust, trajectory.

  • OPM Secretary Testifies in Support of Gov.’s Tax, Bond Proposals

The state’s budget chief, Office of Policy and Management secretary Ben Barnes, Thursday testified before the Finance, Revenue and Bond Committee in support of several tax initiatives put forth by the Malloy administration as part of its 2015 budget adjustment package.   One of the proposals, SB 28, calls for returning $155 million to eligible taxpayers through rebates (or, more accurately, refunds of gasoline and sales taxes). If approved by the General Assembly, they would be available to individuals earning less than $200,000 per year and couples earning less than $400,000.  The fiscal year 2014 surplus is projected to be $504 million.

Another provision of SB 28 would exempt 25-percent of teacher’s retirement income from taxation in the 2014 tax year, increasing to 50-percent in 2015.  Barnes pointed out that teachers in Connecticut do not receive Social Security benefits, and that military retirees receive a 50-percent tax exemption on their pensions.

A Republican member of the committee asked Barnes if the administration would consider using $60 million of the surplus to pay the remaining interest the state owes the federal government on a special unemployment insurance loan taken out during the last recession. Businesses have already paid $71 million in interest charges on the loan through a special assessment.  The lawmaker said it would be welcome tax relief for small businesses. Barnes said the proposal – which is incorporated in a Labor Committee bill put forth by Republicans – would be a “reasonable” use of the surplus, but made no promises.

  • Finance Hearing Focuses on Enabling Legislation for UTC Deal

Legislation enabling the United Technology Corp.’s economic development agreement with the state to go forward took center stage in the Finance Committee on March 10.

Specifically, the legislation – HB 5465 – would enable the Commissioner of the Department of Economic Development to implement the agreement struck between Governor Malloy and UTC recently.  Broadly, the agreement allows for the redeployment of previously earned R&D tax credits for capital investment purposes, enabling UTC to invest $500 million in the state over five years to improve its infrastructure and facilities and invest up to $4 billion in R&D.  The state, labor unions and aerospace vendors are hoping this agreements serves as an insurance policy to keep the state’s largest employer, and its aerospace subsidiaries Pratt and Whitney and Sikorsky, here over the long haul.

Note:  If you are interested in a summary of the UTC agreement, please contact us and we will e-mail.

  • General Law Approves Hospital Fee Notification Agreed to by AG, CHA

The General Law Committee approved a bill that would require consumer notification if facility fees are being charged, in addition to provider fees, when services are rendered at certain hospital-affiliated facilities.   The amended version of the proposal includes coding that will help consumers differentiate the fees (the Attorney General’s suggestion), and a definition clarifying the types of facilities covered (Connecticut Hospital Association suggestion).

  • Malloy Makes Numerous Judicial and Executive Appointments

Governor Malloy topped off the week on Friday by nominating 16 attorneys to fill vacancies on the Superior Court.  In addition, he nominated two highly regarded Superior Court judges to the Appellate Court, and appointed two Family Support Magistrates and one Workers’ Comp Commissioner.   Click below for details:

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