State Lawmakers Predict A ‘Difficult Year’

By Matthew Daly_Associated Press

HARTFORD — Boosting state aid for education, improving services for the mentally ill, and loosening the grip of traffic congestion top the agenda as state lawmakers return to the Capitol this week for the 2001 session of the Connecticut General Assembly.

How to do all that and combat the high price of prescription drugs without violating a constitutional cap on spending will be the challenge. The legislature convened a five-month session on Wednesday, which will run through June 6.

The spending cap, which ties increases in state spending to the inflation rate, could prove particularly vexing to lawmakers this year, since the state projects a budget surplus of at least $400 million.

With that kind of money seemingly available, lawmakers and Gov John G. Rowland may find it especially tempting to circumvent the cap, even as they pledge to honor it.

And after years of economic boom the state faces a likely downturn in the economy, perhaps ending an era of relative harmony in which lawmakers were able to increase spending and cut taxes at the same time.

“It will be a more difficult year” than the past several sessions, said Senate President Pro Tem Kevin B. Sullivan, D-West Hartford.

“We know there will be at least a cooling in the economy,” Sen Sullivan said, “and we know we have made long-term spending commitments and long-term tax-cutting commitments, and we know the [spending] cap is relatively inflexible. All of that... makes setting priorities all the more important.”

But whose priorities will prevail?

Will it be the Republican governor, who has set improving services for mental health and ending gridlock as top goals? Or will it be the Democrat-controlled legislature, which shares many of Gov Rowland’s aims but disagrees on how to achieve them?

For the first time in years the legislature is braced for partisan warfare, as newly enlarged Democratic majorities in the House and Senate flex their muscles and the two parties battle over redistricting mandated by the 2000 census.

Connecticut is losing one of its six Congressional districts, and partisan disputes have already erupted as the two sides try to redraw the state’s legislative and congressional districts.

Despite all that, Gov Rowland is optimistic as he enters his seventh legislative session as governor.

“I think it’s going to be a good session,” he told reporters last month, citing widespread agreement on the need to improve services for the mentally ill, fix gridlock, and help seniors pay for prescription drugs.

While the two parties disagree on specifics, all sides agree those areas – plus education – will be the focus of the session, Gov Rowland said.

Even the spending cap can be an asset, the governor said: By making it hard to spend money on new programs, the cap imposes a discipline that otherwise would be lacking.

Gov Rowland will not unveil his proposed two-year budget until February, but he warned it will be “tight” and may not include the cornucopia of tax cuts he has presented in the past.

“If the economy slows, we’ve got to be very careful about revenue streams,” he said.

One area where partisan disputes are nearly inevitable is education funding. Lawmakers from both parties campaigned this fall on the need to increase state aid to school districts – but differed on which districts should get the money.

Democrats have pledged to phase out a state cap on so-called Education Cost Sharing grants that they say hurts cities and close-in suburbs. Republicans are touting plans to channel more aid to suburban and rural communities.

Lifting the cap on ECS grants could cost as much as $120 million, officials say, while increasing aid to mostly well-to-do, smaller towns could cost another $40 million.

No price tag has been set on expanding prescription drug coverage for the elderly, but both parties call it a priority.

Keeping all those promises and staying under the spending cap could prove virtually impossible unless lawmakers order big cuts in other areas.

Already, lawmakers are talking about finding exemptions in the spending cap to pay for education.

“I’m not going to bridge the integrity of the cap,” said House Speaker Moira K. Lyons, D-Stamford, “but times do change and priorities change as to what the needs are. There could be logical types of exemptions [for education].”

Lawmakers also may resort to creative accounting as they look at ways to spend the surplus on everything from new mental health clinics to parking garages at commuter train stations.

“The estimated surplus is $500 million. So far we’ve spent $2 billion of it,” said incoming Senate Minority Leader Louis C. DeLuca, R-Woodbury. “Everybody has a program.”

But pressure on the $12.3 billion budget will not just come from spending. House and Senate Republicans are touting plans that would double the $500 property tax credit, and House Republicans are also calling for elimination of the sales tax on clothing up to $150.

“If Connecticut has all this surplus money, then why are we paying so much in local and state taxes?” asked House Minority Leader Robert M. Ward, D-North Branford.