Lt Governor’s ‘Listening Tour’ Comes To Newtown

By Jan Howard

Lt Gov Jodi Rell came to Newtown last week as part of what she terms a “listening tour” of chambers of commerce, small businesses, and weekly newspapers.

The purpose of the “listening tour” is to talk about what is happening in Hartford, “what the state is doing right, wrong, or better for the business community,” she said.

She said businesses are giving her input on the effect of foreign trade on Connecticut and troublesome problems, such as patent privileges. In the United States, patents cannot be copied. Foreign countries, such as China, however, can buy the goods, copy the product, and produce it with cheap labor, she said.

“Our businesses can’t compete for price,” the lieutenant governor said. “No one is opposed to free trade,” she noted. However, she added, the state has stepped up efforts to address these concerns and to see if laws have to be changed.

During her talks around the state, Lt Gov Rell said she has been asked about low-interest loans, taxes, and issues about workers compensation and unemployment compensation. Some talk has been generated by the $250 tax on limited liability corporations or LLCs.

“This could be a company’s advertising budget for the year,” she said. “To a business that is a lot of money. If there is no money to spend, there is no advertising.”

The lieutenant governor said, “I’m learning a lot,” through these discussions.

She is also trying in these listening sessions to explain why the state budget process took so long this year. She said she is asked questions, such as, “Why can’t you guys get your act together up there? What’s the problem?”

“First, we should be thanking the legislators for being very deliberative,” she said. “They are doing what they think is best for their constituents.”

She said problems arise because of those who do not want to cut programs and others who do not want to raise taxes. She said Governor John Rowland called for a special legislative session in December to address the deficit, but the legislators did not want to do it at that time. Therefore, it took until March to begin budget deliberations, she said.

In looking to pass a new budget, there was still a projected shortfall, she said. Some legislators, however, were still saying no to additional cuts while others did not want to ask for new taxes. “It was legislator against legislator. It was not a partisan thing,” Lt Gov Rell said. “All the time the deficit was growing.”

She said the governor told Republicans not to raise taxes, but Democrats were insisting there be no more cuts to programs.

“The last $200 million was the hardest,” the lieutenant governor said. “That’s why it took longer.”

Another question she is asked often is, “Weren’t you guys just bragging about surpluses? What did you do with the money?”

Lt Gov Rell said for over eight and a half years, the state and country were doing well. Connecticut cut taxes, eliminated the inheritance tax, and decreased the corporation tax from 13½ to 7½ percent. “It makes us competitive,” she said.

The gas tax was cut 14 cents over a period of time. “Each penny is worth $13 million. We had the money to do it,” she noted. The state also used funds to pay off high interest debt at 14 percent. “The surplus was used for debt higher than six percent,” Lt Gov Rell said. “We made prudent choices.”

These included rebates to taxpayers and the purchase of thermal imaging cameras at a cost of $6 million for every fire department, paid and volunteer, in the state.

What saved the state from worse problems, she noted, is that it has a constitutional cap on spending. “That saved us… It held us in check,” she said. She noted, however, some people argue it is a false line of security.

Some states had it much worse than Connecticut, such as California, which has a $38 billion deficit. Connecticut is one of 47 states with a deficit, she said.

“When people ask if Gray Davis is at fault, he’s only one of 47,” she noted.

How does the state get out of this so it does not happen again? “There are no guards against a decline in revenue,” the lieutenant governor said. “There was a slowing of the economy before 9/11, but 9/11 exacerbated that. After 9/11 people didn’t go out. The state was not collecting taxes because people were not buying big ticket items.”

When people were making money on investments, the state was making money. Then the state lost $1 billion in revenue. “Revenue was not coming in at the same pace as 1996 to 1999,” she said.

 To make the budget work, she said, “We had to come together. It was the art of compromise between legislators.

“Connecticut ultimately will be proud of the actions taken,” she said. “It was a combination of cuts and taxes.”