Giving In to Weicker, Conn. Lawmakers Back Tax
Breaking with tradition, weary Connecticut lawmakers last month acquiesced to the insistent demands of Gov. Lowell P. Weicker Jr. and approved a personal-income tax.
The personal-income levy, which would be the first in the state's history to be implemented effectively, helped balance a $7-billion budget that includes a modest increase for elementary and secondary education.
Resolution of the impasse between the General Assembly and Governor Weicker, which was broken 53 days into the state's new fiscal year, closed the chapter on the lengthy list of states that had missed their July 1 target dates to adopt budgets.
Earlier in the month, and 34 days into their fiscal year, Pennsylvania lawmakers approved a $13.9-billion budget that coupled a big boost in funding for education with the largest tax hike in the state's history.
Mr. Weicker, a former Republican elected as an independent, wore down Connecticut lawmakers' resistance to an income tax by his continual refusal to approve a budget without one. Three times he vetoed budgets that relied heavily on sales and corporate taxes.
"He is a very persistent man," said Representative Nancy Wyman, House chairman of the joint education committee. "There cannot be a doubt in anybody's mind the Governor wanted a balanced budget. I'm not sure that it was his pressure of wearing people down [as much as that] he could constantly point out why the other packages were not going to work."
"He remained implacable as to the principle. He was always flexible to the details," said Avice Meehan, the Governor's spokesman.
The final hours leading up to the historic passage yielded all the drama of theater, according to observers. In the wee hours of Aug. 22, the Senate was deadlocked at 18 to 18 before Lieut. Gov. Eunice S. Groark cast her decisive vote for the tax.
Several hours later, the House threw a monkey wrench into Mr. Weicker's apparent victory when representatives defeated the measure 81 to 69. After Speaker Richard J. Balducci personally appealed to House members, however, the income-tax-based budget passed by a slim 75-to-73 vote, bringing some House members to tears.
Larry Perosino, spokesman for the Speaker, said enough members had indicated the first time around they would vote for the package if it was going to pass. When the vote came, though, "there was a little confusion," he recalled.
Provisions of the new budget are somewhat different from those proposed by the Governor last winter. (See Education Week, Feb. 27, 1991 .)
A flat 4.5 percent income tax on residents was sot to take effect Sept. 1. Beginning Oct. 1, the 8 percent sales tax will be cut to 6 percent and its base expanded to include some new goods and services. The corporate-tax surcharge will be phased out. The budget also includes spending caps, and a constitutional amendment to set budget limits is expected to go before the voters in 1992.
Education is earmarked for an increase of $52 million, bringing the budget to $1.4 billion, noted Commissioner of Education Gerald N. Tirozzi, who called the 4 percent increase "somewhat positive" given the weak regional economy.
Some communities, however, will lose funding as the state shifts money to poorer districts. Also losing money is an innovative state training program for beginning teachers.
Although higher than last year, the state share of education funding has dropped from 45 percent in fiscal 1990 to 41 percent this year, according to Patrice A. McCarthy, general counsel of the Connecticut Association of Boards of Education.
While the income tax will aid education, Ms. McCarthy said it will not answer all funding problems. "We need to continue to move to a more progressive tax structure," she said.
"I think the potential for education funding is much greater as a result of an income tax being passed," said Mr. Tirozzi.
Pennsylvania: State Aid Rises
Passage of Pennsylvania's budget on Aug. 4 ended a deadlock that had kept more than 100,000 state workers from receiving their entire paychecks and made it difficult for districts to plan for the new year.
Political analysts said the lengthy delay in approving the budget was due to maneuvering over which party would be seen as beating responsibility for a tax increase, even one that was widely viewed as inevitable.
The Keystone State had ended the previous budget year with a $454-million deficit and grim revenue predictions for the coming year. The $2.85-billion tax increase eventually approved includes an increase in both personal- and corporate-income taxes. It would also expand the sales tax.
Precollegiate education was a big winner in the budget plan. Basic state aid to schools will increase by 7.3 percent, to $2.9 billion, while funding for special education is slated to increase by $128 million, to $723 million.
The increase in special-education funds is intended to ease the program's transition to a new funding system, which was strongly backed by Gov. Robert P. Casey as a way of controlling spiraling costs.
Under the system, special-education funds will be allocated to districts on a formula basis. The old "excess costs" system, in contrast, reimbursed districts for the expense of educating a disabled child that exceeded the average cost of serving a non- disabled child.
The budget also sets aside for the first time $20 million for low-wealth districts. Lawmakers said the amount was intended to signal the state's willingness to address inequities in its school-funding system, which is currently facing a court challenge.
Districts also stand to benefit from the budget's reduction in the rate of required contributions to the Pennsylvania Public School Employees' Retirement System.
As a result of the budget changes, districts will reopen their budgets and consider making tax rebates.
Vol. 11, Issue 01, Page 30Published in Print: September 4, 1991, as Giving In to Weicker, Conn. Lawmakers Back Tax