NEWS courtesy CT Community Nonprofit Alliance and Cultural Alliance of Fairfield County

Yesterday, Governor Malloy unveiled his $18.14 billion midterm budget proposal for State Fiscal Year (SFY) 2017, officially kicking off the 2016 legislative session. The proposed General Fund bottom line of $18.14 billion cuts $569.5 million from the enacted SFY17 budget, which is $722.1 million below OFA’s current services estimate that was produced last November.

Major policy changes proposed include: changing how state agencies manage their budgets, as a response to “new revenue expectations,” since expenditure growth has outpaced revenue collection leading to persistent budget deficits over the last few years. The proposed budget contains no tax increases, calls for an enforceable spending cap, expands the Second Chance Society initiatives, and once again calls for a transportation funding lockbox to be included on the ballot this November. It does include an additional $15 million for the Nonprofit Grant Program, for capital projects, bringing the SFY17 total to $25 million.

End of Line Items
The biggest change to the state budget is a shift in how state agencies manage funding. The Governor proposes to move from a list of individual line items toward a “single block grant account,” now called “Agency Operations” or “Agency Operating Fund” Account. This proposed change would give each state agency the authority to move money which was previously appropriated by the legislature line-by-line and/or to reduce spending at will across agency programs. Most importantly, Governor Malloy proposed that the “Agency Operations” line item would subject to a 5.75% cut.

Department of Economic & Community Development
Changes are proposed to increase transparency within agency budgets:
* Certain line-item grants such as Arts, Tourism and other Community Services are consolidated under the State Comptroller.
* Budgeting for Arts, Tourism and Other Community Grants:
Line item grants are proposed to be cut by 25% and then transferred to the Comptroller’s miscellaneous accounts in the following areas:
• $3.8 million for Arts Grants
• $0.4 million for Community Development Grants
• $3.3 million for Tourism Grants
• $6.0 million for Workforce Development Grants
• $2.3 million for Youth Development Grants

* The Governor also proposes converting all of these grant programs into a competitive process. Now, many of these grants are specific earmarks in the state budget.

Adjustments to bond authorizations for FY17 include:
Eliminate Funding for Certain Programs in Other Expenses
* Eliminates funding for Dream It. Do It., OpSail, Schooner, Stamford Parade, New Haven Symphony, Blackwell School of Music, and the Connecticut Grizzlies.
* Funding for Arts, Tourism and Other Community Grants is reallocated to the Miscellaneous accounts administered by the Comptroller. Outside agencies, non-profits, community organizations, special events and the like should be accountable for their results in support of core state functions, with available funding transitioned to a competitive basis.

In total, the proposed cuts to the Department of Economic and Community Development (not including fund transfers to other departments) are $4,697,424.

For more detail see pages 7-8 of this document.