Governor Rell Sends Lawmakers Copy of Analysis

Outlining Fiscal Problems with Vetoed Bills

Quantifiable Costs Alone Total $1.5 Billion, Unknown Costs Far Higher, OPM Says – Governor Says Risk Too High Amid Record Deficits

            Governor M. Jodi Rell today announced she has sent every member of the General Assembly a copy of a memorandum from her budget director that outlines the serious fiscal concerns raised by 14 of the bills she recently vetoed, noting that the quantifiable costs of the proposals total roughly $1.5 billion a year – and the bills include hundreds of millions of dollars in additional, unknowable costs.

            “As well-intentioned as many of these bills may be, they are simply – and completely – unaffordable when our state is facing a deficit in the next two years of $8 billion,” Governor Rell said. “Since the spring of last year I have been doing all in my power to reduce state spending. My budget proposals have been focused on reducing the size of state government and making it more affordable both now and in the future. To have signed these bills would be to go in exactly the wrong direction.

            “As lawmakers on both sides of the aisle prepare for the constitutionally required ‘veto session’ next week where they will consider whether to attempt overriding any of my decisions, I sincerely hope they will take these concerns to heart,” Governor Rell said. “In this time of extraordinary fiscal pressure, as elected representatives and leaders of Connecticut we literally cannot afford to make these decisions on the basis of partisan or parochial interests. Rather, legislators must consider the greater good of all.”

            The analysis, by Secretary Robert Genuario of the Office of Policy and Management (OPM), summarizes the financial concerns OPM raised about 13 bills with fiscal impacts that Governor Rell vetoed during the regular legislation session as well as the budget passed by majority Democrats during a special session in late June.

            The vetoed bills include:

• PA 09-148, the “SustiNet” bill: OPM noted that the bill creates an unelected authority to take over health care policy and decision-making and pave the way for a health care plan that will cost at least $1 billion a year to fully implement.
• PA 09-147, the “pooling” bill: This bill would have opened the state employee health care plan to municipal, non-profit and small business employees and made it a self-insured plan. While doing so might result in a one-time savings of $62 million, as a result of a lag in paying claims, it would incur added costs of $245,600 a year for three new employees in the Comptroller’s office; $69 million a year in new costs for medical claims, based on current experience; $100 million to create a reserve fund; and $10 million to buy stop-loss insurance, OPM said. Unknowable costs include the likelihood that new enrollees would drive up medical costs and premiums.
• PA 09-202, the “green buildings tax credit” bill: This bill would have established $25 million in tax credits to promote environmentally friendly development. At a time when the state is dealing with a huge budget deficit, this revenue loss in unacceptable, OPM said. Further, this would have been a tax credit against the personal income tax, something the state has generally avoided.
• SA 09-15, the “MDC museum exhibit” bill: This bill would have allowed the Metropolitan District Commission, which provides water and sewer service to eight communities and portions of others, to charge ratepayers up to $2 million to pay for the costs of museum exhibits about water. OPM noted that ratepayers have not authorized these costs and would have no way to contest them.