Connecticut Gov. Malloy Vows To Veto GOP-Backed Budget Plan

HARTFORD, Conn. (CBSNewYork/AP) -- Connecticut House and Senate Democrats have broken with party leadership, stunning the political establishment, to pass a Republican-backed state budget plan that calls for large spending cuts but no tax hikes.

The House voted 78-72 early Saturday to approve the $40.7 billion plan. Six Democrats were swayed to support it. Hours earlier, on Friday afternoon, the plan passed in the Senate on a 21-15 vote, stunning the political establishment. Three Democrats voted for it. Senator Joan Hartley was one of them.

"My vote was premised on a lot of work and due diligence and only on the numbers on the facts," she tells WCBS 880's Mike Smeltz.

Democrats control the legislature and Gov. Dannel P. Malloy, a Democrat, said Friday he would veto the legislation if it reaches his desk as is. He called the GOP plan "unbalanced."

It relies on too many unrealistic savings, it contains immense cuts to higher education, and it would violate existing state contracts with our employees, resulting in costly legal battles for years to come," Malloy said of the GOP plan.

The state faces an estimated $3.5 billion budget deficit over two years. The $41 billion budget plan proposed by Democrats includes increases in taxes and fees, but both parties say their proposals are designed to eliminate the deficit.

A final budget plan for the fiscal year that began July 1 and the year beginning next July 1 is already two-months late. Malloy has been running government with his limited spending authority. And without a new budget law by Oct. 1, major spending cuts could automatically go into effect, including to cities and towns.

Hartford officials have said that city could be pushed to the brink of bankruptcy. Eighty-five school districts will lose all of their state Education Cost Sharing funding and another 54 would see reduced funding.

Hartley says she hopes her vote will reset the clock on budget negotiations.

House Minority leader Themis Klarides, a Republican, tells WCBS 880 that until now, Democrats had only acted like there were two options; vote for their party's plan or accept the huge across the cuts board looming in October.

"There were clearly people in the Senate Democratic caucus that saw and believed in the fact that there was a third choice, and that third choice was the best choice for Connecticut," she said Saturday.

The GOP plan relies heavily on changes in state employee pensions after the current state union deal ends in 2027. Republicans say it achieves $270 million in savings by requiring workers to pay more toward their retirement benefit, eliminating cost of living adjustments until the fund balance of the state employee retirement system is deemed healthy by national standards and by eliminating overtime from the calculation of an employee's salary for pension benefits.

The plan also would eliminate several state agencies and commissions, including the Commission on Women, Children and Seniors and the Commission on Equity and Opportunity. Other agencies would be merged.

The Democrats' plan includes a new 49-cent monthly surcharge on cellphones, a $12 surcharge on homeowners' insurance policies, a new vacation home tax, higher taxes for hospitals, a 25-cent charge per trip on ride-sharing services like Uber and a 45-cent-per-pack cigarette tax increase. The budget also would decrease the personal property tax exemption on state income tax forms, from $200 to $100, and set aside $115 million for improvements to the XL Center arena in Hartford.

In addition, the Democrat plan includes $1.9 billion in education aid to cities and towns this year and would avoid large cuts to local education aid proposed by Malloy as part of a spending plan that would take effect if lawmakers don't pass a budget by the end of the month.

Malloy said the Democrats' budget would not increase the income or sales taxes, would cut spending by hundreds of millions of dollars and would restore hundreds of millions of dollars in town aid.

(© Copyright 2017 CBS Broadcasting Inc. All Rights Reserved. The Associated Press contributed to this report.)