Dannel Malloy, Connecticut’s Democratic and Working Families Party Governor, told citizens of his state last year that the highest tax increase in the history of Connecticut, including a retroactive state income tax hike, would balance his state’s budget. It appears he was wrong. Bloomberg has reported that Connecticut will have a $94.9 million revenue shortfall in fiscal year 2012. In addition, official estimates indicate that the state’s revenues will trail by $139 million in fiscal year 2013.

Minimizing the significance of the shortfall, Gov. Malloy said in a press release:

All today’s announcement means is that, as is the case in other states with high wage earners, fourth quarter revenue is coming up short of expectations. That’s why today, I’ve instructed Secretary Barnes to pare back on current year expenses.  But let there be no confusion – we will end the current fiscal year in the black, and in a more stable fashion than this state has seen in many years.

Blaming the shortfall on the “uncertainty surrounding the extension of the Bush-era tax cuts,” Mr. Malloy said that such “uncertainty at the federal level” resulted in taxpayers’ shift of capital gains and income, as well as declines in bonus levels in the financial service industry.

Last year, Gov. Malloy used the tax hike to balance his state’s budget against a public sector union concession package that actually required few concessions of unions: no layoffs for four years and no furloughs; wages frozen for two years, then followed by three annual 3 percent raises; retirement age raised by only two years, and not until after 2022; and minor changes in health benefits such as mandatory annual physician visits and mail-order prescription plans.

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The legal counsel of Governor Dannel Malloy (D-CT) has reported that “many” Connecticut state employees may be involved in food stamp fraud, and is urging heads of state departments to cooperate with investigators and prosecutors on both the state and federal levels.

During a rather abruptly organized press conference last Sunday, Gov. Malloy revealed that 800 of the 23,000 people who obtained federal disaster aid, following Tropical Storm Irene, were state employees, some of whom may actually qualify for the assistance. Thus far, 24 state employees appear to have fraudulently qualified for the disaster aid.

Andrew McDonald, the governor’s chief counsel, said, “We have credible information to suspect that many state employees who received the benefits did so by materially misrepresenting important information included in their applications” for food stamp benefits.”

Those who applied for the disaster funds, known as D-SNAP, received debit cards for as much as $1200, to replace food that had reportedly spoiled due to lack of electrical power during the period following the storm.

As was reported here on September 29, 2011, thousands of people waited in lines for days in the wake of Tropical Storm Irene, in front of Connecticut’s DSS buildings, some of them obtaining emergency funds even though they lived in areas, such as the capital city of Hartford, which had not lost power as a result of the storm. The state administered the $12.4 million in disaster aid funded by the federal government.

The ease with which many were able to obtain D-SNAP funds was discussed anecdotally on local radio talk shows. The chaotic hordes of people lining up to receive D-SNAP funds led conservative Republican state Sen. Joseph Markley to approach the state auditors and ask them to look into the situation. On a talk radio program, Sen. Markley said, “I think, during the course of their investigation, they started turning over some rocks, and it became obvious that there was wrongdoing involved, and some embarrassment. And I believe that’s what led the governor to get out ahead of the story, holding this extraordinary press conference on a Sunday afternoon.”

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According to the Institute for Truth in Accounting (IFTA), Connecticut has been identified as the top financial “sinkhole” state in the nation. IFTA, a nonpartisan and nonprofit organization that works for greater accounting transparency across all levels of government and business, reports that the Constitution state is at the top of a list of five states which are in the worst financial position. According to the organization’s Financial State of the States report, Connecticut has $29.4 billion worth of assets, but only $10.1 billion are available to pay $63.4 billion of bills as they come due. In addition, each Connecticut taxpayer’s financial burden is $41,200.

The report indicates that the other four states considered to be financial “sinkholes” are New Jersey, Illinois, Hawaii, and Kentucky, all of which have a per taxpayer burden of over $23,000. However, Wyoming, North Dakota, Nebraska, Utah and South Dakota are considered “Sunshine States” because either a per taxpayer’s surplus or nominal per taxpayer’s burden exists in these states.

Interestingly, Republican Gov. Dave Heineman of Nebraska, a “Sunshine State,” was invited to Hartford by Democratic and Working Families Party Governor, Dannel Malloy, of Connecticut for a regional economic summit in October. Gov. Heineman’s description of his success in bringing about the largest tax cut in his state’s history, and Nebraska’s 4.2% unemployment rate- the second lowest in the nation- drew a sharp contrast to Gov. Malloy’s explanation of his experience in “straigtening out the state’s finances” by enacting the largest tax increase in his state’s history.

“I believe we’re moving in the right direction,” Mr. Malloy said. “The reason I did what I did with respect to the budget was so that I could look business in the face and say, ‘Listen, I believe we’ve got the bulk of our problem behind us. We’ve balanced a budget. We’ve taken the steps necessary to wrestle a structural deficit to the ground and we move forward.’ ”

Sheila Weinberg, founder and CEO of IFTA, however, disagrees. Ms. Weinberg said that Connecticut’s “state officials say their budgets are balanced but do not include employee pension and healthcare obligations in their calculations.”

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An unprecedented nor’easter that ravaged the northeast last weekend with snow, wind, ice, fallen trees, and downed wires, left more than 820,000 Connecticut residences and businesses without electric power as of last Sunday. Some in Connecticut and Massachusetts remained still, after a week, without power. The storm arrived just two months after Tropical Storm Irene left nearly the same number of customers without power, some also for a week.

Many school districts in Connecticut have been closed for a full week, with school buildings that have generators having been turned into shelters for those needing hot meals and protection from evening subzero temperatures. Long lines at gas stations, reminiscent of the Carter presidency shortages, became a familiar sight in some areas. Halloween was officially “cancelled” in many towns, and many small businesses, already struggling due to both the economy, in general, as well as recent tax increases in Connecticut, have now suffered two full weeks of losses this year due to the lack of power.

Connecticut Light & Power (CL&P), a subsidiary of Northeast Utilities (NU), the state’s main electric utility,  reports that storm-related repairs are expected to cost between $75 million and $100 million. The company, which, like other utility companies affected by the storm, had to import line crews from other states, set a goal of 99% restoration of power by midnight, November 6th, a goal it was unable to meet.

But the serious tangle of trees and wires on the ground also mirrors the messy mixture of honest outrage of Connecticut residents and the political grandstanding of the state’s Democratic politicians who have had, in fact, a marriage of convenience with the mega-utility. 

In response to the anger and frustration of Connecticut residents and businessowners, there is plenty of Democratic finger-pointing and blaming to go around. Democratic and Working Families Party Governor Dannel Malloy, and Democratic lawmakers, are vowing to hold CL&P’s feet to the fire. Democratic Speaker of the State House, Christopher Donovan, a candidate for Congress, has suggested that CL&P be fined for not restoring power to customers sooner. Democratic Attorney General George Jepsen has called for an investigation into the utility company. And Jeff Butler, chief operating officer of CL&P, appears always ready to draw fire with his statements about how the company is “frustrated” that it has not been able to obtain more line crews, and how it has not met its stated goals. An interesting cast of characters, many of whom are also prepping Connecticut residents for rate increases to pay for the restoration for two major storms or “fines,” if they are imposed.

There are some legitimate problems with CL&P.

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Continuing a fiat governance style that is right out of the Obama playbook, Democratic and Working Families Party Governor Dannel Malloy issued two executive orders yesterday that will force daycare providers and home healthcare workers in Connecticut to join unions.

The orders, his ninth and tenth since taking office in January, will force the state’s 4,000 daycare providers to add over $1 million in dues to union coffers, and remove the right to secret ballot election for these workers by instituting a card check process.

The governor said:

“I have said repeatedly that I believe in the rights of workers to organize and collectively bargain, and personal care attendants and family child care providers are often-times the hardest-working, and lowest-paid workers in our job force,” said Governor Malloy.  “These executive orders will enable them to begin informal conversations with DSS and the Workforce Council immediately on quality-of-life issues, with an eye toward establishing formal collective bargaining rights in the future.  It is important that those who care for both our youngest and oldest citizens receive equitable pay and workforce security.”

According to Zachary Janowski, Mr. Malloy came through for the unions where the Connecticut legislature failed. A bill that would have converted “family child care providers” into state employees, for the purpose of collective bargaining, had been introduced in the state Senate, but never made it to a vote.

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It is no secret that the White House is using, with alarming frequency, czars, boards, and executive orders to implement policies that have been met by “inconvenient” obstacles- like the American people and their representatives in Congress.

Following in President Obama’s authoritarian footsteps is the ruling Democratic class of the small state of Connecticut, where Obama-clone Governor Dannel Malloy has recruited, from Yale University, nationally known environmental expert, Daniel Esty, to be the state’s commissioner of the newly combined Department of Energy and Environmental Protection (DEEP). Of his new recruit, Governor Malloy said, “His experience advising private companies and the president of the United States, coupled with his knowledge of environmental law and policy is second-to-none, and I know this new department will be on the cutting edge of environmental and energy policy with Dan at the helm.”

In 2007 and 2008, Mr. Esty served first as Presidential candidate Barack Obama’s campaign adviser on energy and the environment, and later on as a member of the presidential transition team. So, little wonder Mr. Obama and Commissioner Esty are of the same ilk when it comes to “green” energy and its imposition into the lives of the American people- whether they want it or not.

Mr. Esty sparked considerable controversy recently in the Constitution state through his unprecedented intervention in the matter of Connecticut’s Public Utilities Regulatory Authority’s (PURA) management of a multimillion-dollar application by Connecticut Light & Power Co. (CL&P), which provides electric utility service to most of the state. The application, which involves the rapid installation of 1.2 million “Smart Meters” at residences and businesses over the next four years, was challenged by the state’s Attorney General, George Jepsen, the Office of Consumer Counsel, and an association of industrial energy users. Several weeks ago, Commissioner Esty wrote PURA, upon its draft decision to reject CL&P’s application, asking it to suspend its decision for a few months until his department can “establish the state’s smart meter policy.”

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Democratic and Working Families Party Governor Dannel Malloy of Connecticut dusted off the speech he had planned to make at the end of June, when state employee unions rejected a $1.6 billion concession package that would close a hole in the state’s budget. Embarrassed that their rank and file members rejected the plan that they agreed to with the first Democratic governor of the state in 20 years, the State Employees Bargaining Agent Coalition (SEBAC) agreed to a new vote after changing the bylaws to allow a simple majority of state employees, rather than 80%, to be the required threshold for ratification of contracts. The old bylaws also did not allow for revotes.

Following the governor’s threats of thousands of layoffs, the concession package, as anticipated, was overwhelmingly approved on the second vote on Thursday by 14 of the 15 unions. Ironically, the union representing corrections officers, AFSCME, which had rejected the package originally, approved it wholeheartedly this time, despite the fact that corrections workers have solicited membership in the National Correctional Employees Union (NCEU), charging that they were misrepresented by the vote to change the bylaws.

Upon ratification of the contract, the governor released the following statement:

“We have achieved something the skeptics said was unachievable: we’ve made the relationship between the state and its workforce sustainable. And, unlike in most other states, we did it without going to war with public employees. We’ve shown what’s possible when management and labor work together in a respectful fashion. Sure, this agreement took a few extra months to achieve – but so what? Those extra months are a small price to pay for the billions of dollars that extra time will save taxpayers, the critical services that time will preserve, and the peace of mind that comes from understanding the state now has a sustainable relationship with its employee base…”

The agreement calls for a two-year wage freeze and some changes to pension benefits and healthcare, such as required annual visits to a physician. In exchange, the unions obtained no layoffs for four-years and a pledge they would not be required to take unpaid furlough days. According to Mr. Malloy, the changes will save the state an estimated $1.6 billion over the next two years and $21.5 billion over the next two decades. As of July 1st, the governor’s budget plan called for “shared sacrifice” from taxpayers, who have consequently experienced the largest tax increase in the history of the state, including a hike in the income tax, retroactive to January 1st.

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Connecticut residents are awaiting the results of the second vote of its state’s unions on a concessions package that will, allegedly, allow rank and file union members to participate in the “shared sacrifice” of Governor Dannel Malloy’s budget. To the dismay of the Democratic-led legislature, their Democratic governor, and union leaders, state workers voted to reject the package in late June, leading the coalition of union leaders to change their bylaws and lower the bar required for ratification of contracts to a simple majority.

Obviously, union leaders knew their members were unhappy with, or perhaps unaccustomed to, having to make concessions. Requiring less of them to accept it should do the trick and ensure a successful vote, right?

While the governor has done his urging through threats of thousands of continued layoffs and elimination of some state services, Connecticut state workers have also received encouragement to vote, “Yes,” from outside the state’s borders.

In an editorial in the Hartford Courant’s online edition, Wisconsin union leaders Marty Beil, executive director of Council 24 of the Wisconsin State Employees Union, and Michael Thomas, president of the SEIU Wisconsin State Council, urged Connecticut unions to accept the concessions package because, quite frankly, they’re jealous they couldn’t get a deal as good as this one.

The union leaders write:

“We know that the proposed agreement contains real sacrifices, but we also know that it contains four years of job security, offered nowhere else in the country; and extension of your pension, health and retiree health contract; and has good wage increases in the latter years.

Like Connecticut’s working families, we are outraged by the direction our country has moved in, by how much is asked from middle-class workers and how little from billionaires like the Koches [sich]. There is a long fight ahead before working families in Connecticut, Wisconsin or anywhere in our nation will again be treated the way we ought to be.”

Let’s “decipher” some of this:

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Connecticut state correctional officers and prison employees say they have been misrepresented by their union leaders. The current members of a Connecticut local of the American Federation of State, County and Municipal Employees (AFSCME) are actively soliciting membership, instead, in the Massachusetts-based National Correctional Employees Union (NCEU), following their union leaders’ participation in a decision by the State Employees Bargaining Agent Coalition (SEBAC) to change its bylaws. SEBAC voted on the change in order to make good on a $1.6 billion concession package deal struck with Democratic and Working Families Party Governor Dannel Malloy. The AFSCME local’s 4,500 members rejected the original concession package, leading to only a 57% approval vote, when the bylaws required 80% approval by rank and file members. SEBAC has now voted to lower the bar for ratification of contracts to require only a simple majority.

Since the rejection of the concessions package, Governor Malloy has threatened to lay off about 4,300 state workers and put an end to many government services. The governor plans to lay off nearly 900 correctional officers and close several prisons, two of which, Mr. Malloy’s advisor states, will close even if a new labor agreement is achieved.

According to CT News Junkie, correctional officer John Boyle, who will be retiring, said he is very unhappy with both AFSCME and SEBAC, both groups he views as existing only to collect dues from workers. “They’re taking people’s money going behind closed doors and selling them out,” he said. Mr. Boyle is organizing a class-action suit against union leaders.

The Day reports that Christopher Murphy of the NCEU, is helping to gather signatures to begin the process to allow the correctional officers to leave AFSCME. “They feel AFSCME is taking care of its own issues and has its own agenda, and is working very closely or is in bed with the governor.” Mr. Murphy said that SEBAC has overreached its authority by negotiating agreements beyond those related to healthcare and pension provisions. He added that SEBAC violated its own bylaws in the process of changing them and suggested NCEU would fight them with every legal avenue available.

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Call it hokus pokus or smoke and mirrors. The Norwich Bulletin reports that the leaders of Connecticut’s state employee unions (SEBAC) plan to meet on Monday to vote to change their bylaws in order to stave off Democratic and Working Families Party Governor Dannel Malloy’s threats of 4,300 layoffs and the halt of many government services. As was reported here several weeks ago, 57% of public sector union members rejected a concession package, which was to close a $1.6 billion hole in the state’s budget, where, currently, 80% rank and file is required for approval of concessions.

Amidst much fanfare focused on the special relationship between Connecticut’s public sector unions and their choice for governor, Mr. Malloy and union leaders agreed to the concession package, behind closed doors. Union leaders were embarrassed that the concession plan approved by the governor they worked to elect was rejected by a sufficient number of their members, suggesting that they were out of touch with their rank and file members. In June, however, Matt O’Connor, a spokesman for the coalition of union leaders, said some union members were operating under several misperceptions, including a belief that a rejection of the deal would lead to further negotiations.

Apparently, yesterday’s misperceptions are today’s realities.

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Connecticut’s public sector unions have voted to reject a $1.6 billion concession package that was previously agreed to by both their union leaders and Governor Dannel Malloy, the first Democratic governor the state has had in 20 years. Just one year ago, as union leaders worked tirelessly on Mr. Malloy’s campaign, one union president, Catherine Osten, issued a statement calling his candidacy a “once-in-a-lifetime opportunity to elect a governor who will be a true partner.” The governor nurtured the relationship between himself and the unions, while he criticized other governors who were confronting the continued demands of union leaders in order to balance their state budgets.

The concession package, that seemed to pale in comparison to the concession plans agreed to by unions in other liberal states, guaranteed no layoffs for four years and no furloughs. Wages would have been frozen for two years, then followed by three annual 3 percent raises. Though cost-of-living increases for pensions would have been eliminated, the retirement age would have been raised by only two years, and not until after 2022. Changes in health benefits included mandatory annual physician visits and mail-order prescription plans, a detail that seemed to hurt local pharmacies more than union members.

As a result of the rejection of the agreement by the unions, Governor Malloy says he will now have to lay off 7,500 state employees in order to balance the state budget. In addition to the direct loss of jobs, in a state in which the unemployment rate is already at 9.1%, citizens will undoubtedly be dealing with the closing of state offices, elimination of services, and cuts to municipal aid.

The governor’s Democrat-controlled legislature already passed a budget, in advance of the unions’ vote on the concessions plan, that included the highest tax increase in the history of the state, scheduled to go into effect on July 1st. Also initiated in the budget was an earned income tax credit of about $1700 for those who do not pay taxes.

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In response to the results of two recent polls of Connecticut voters which found that there is considerable dissatisfaction with Democratic Governor Dannel Malloy, the governor’s special advisor said that Mr. Malloy has “made the tough decisions necessary to clean up the financial mess he inherited when he took office in January.” Roy Occhiogrosso added, “You can choose to be popular, or you can choose to lead. Governor Malloy has chosen to lead … he’s not trying to win a popularity contest.”

Yet, a Quinnipiac University poll showed just the opposite: that while Connecticut voters give Governor Malloy a 38% job approval rating, with 43% polled particularly “dissatisfied,” and 16% “angry” with his state budget, 48% of voters “like” him “as a person.” It would seem that, indeed, Mr. Malloy is winning more of the popularity, or “likability” contest. What most Connecticut voters do not appear to like is his leadership, which embraced the largest tax increase in the history of the state, one that included a retroactive income tax hike, and an aggressive legislative session that contained  a state version of the “Dream Act,” which allows in-state tuition rates for children of illegal aliens, a “transgender rights bill,” an “Early Release” for prisoners bill, and an “Amazon” tax bill.

Douglas Schwartz, the poll’s director, commented, “”Gov. Dannel Malloy should be doing better in a blue state like Connecticut, but he gets only a 52 percent approval rating among his base of Democrats.” Ironically, his high tax package was viewed as fair by more Republicans (27%) than Democrats (10%) or independents (19%).

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Even as other liberal states face the music of unfunded union pensions and benefits, Connecticut’s governor plans to do things his way. Democrat Governor Dannel Malloy, and his majority in the state legislature, have agreed on a budget that will represent the largest tax hike in the history of the state. The fact that the constitution of the state of Connecticut requires a balanced budget also seems a minor detail to Malloy, who initially said he would balance his two-year, $40 billion budget by obtaining $2 billion in concessions from the state’s unions. The only problem is that Malloy wants his leaders to pass their budget with no union concessions on the scene. And Governor Malloy wants it now.

Malloy’s governing philosophy is in stark contrast to that of neighboring New York governor, Andrew Cuomo, a liberal, but pragmatic Democrat, who insisted on a budget that did not raise taxes yet demanded, and received, union concessions. Similarly, fellow New England states, Massachusetts, which recently voted to restrict collective bargaining, and New Hampshire, likely to become the 23rd “Right to Work” state in the nation, are clearly moving in step with the rest of the country, by addressing the costs of unfunded public sector union pensions and benefits, as well as the conflict-ridden collective bargaining system.

Malloy, however, has openly bragged about his willingness to spend several weeks in packed town meetings, listening to irate citizens of the Constitution State complain about his budget plan. He and his majority party are clearly cut from the same Obama administration cloth that is inclined to ignore the will of taxpaying citizens, while it attempts to instill guilt with the all too familiar phrase, “shared sacrifice.” To them, “shared sacrifice” means that Connecticut’s taxpayers, already among the highest taxed in the nation, will be paying an average increase of $3,000 per family annually to their state. This amount represents tax increases on income, sales, gasoline- up 3 cents per gallon, alcohol- an increase of 20%, cigarettes, an “Amazon” internet sales tax, as well as a lowering of a $500 property tax credit to $300.

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