Gov. Dannel P. Malloy is presenting his first two-year budget for Connecticut, a plan that raises taxes across-the-board, seeks $2 billion in savings from state employees and attempts to cut spending without stripping programs for the needy, The Associated Press reports. It will also include several economic development initiatives that aim to jump start the state economy.
Among the initiatives is a new “First Five” Program that will allow five business development projects over the next two years that invest at least $25 million or create 200 or more jobs to receive a full package of state incentives and tax credits and forgo certain bureaucratic red tape.
The program will allow the state to combine certain tax credit programs like the Reinvestment Tax Credit, the Manufacturing Assistance Act, and the Job Creation Tax Credit on a single project and waive certain rule restrictions to broaden eligibility and reduce delays in the process.
The budget will also raise the urban and industrial site reinvestment tax credit cap from $500 million to $750 million, while increasing the job creation tax credits annual cap from $11 million to $20 million.
The budget will also provide $80 million in additional bonding for direct incentives for development projects.
The new Democratic governor is scheduled to address a joint session of the General Assembly on Wednesday at noon. The event will be televised live on some state TV stations.
Malloy’s budget, which spends $19.7 billion in the first year and $20.2 billion in the second, attempts to plug a deficit of about $3.5 billion.
Unlike past state budgets, Malloy says his does not borrow money to cover operating expenses.
The plan spends more money on transportation.
Legislative Republicans say they were hoping to see more spending cuts and fewer tax increases.
