By Keith Phaneuf ctmirror.com

LemboState Comptroller Kevin P. Lembo found a few rays of sunshine Thursday in Connecticut’s otherwise gloomy fiscal picture.

One day after analysts briefed the legislature’s budget panels on surging retirement benefit and other debt costs that could imperil state finances through the early-to-mid 2030s, Lembo peppered his monthly budget forecast with “positive economic indicators that are worth highlighting.”

But after projecting a relatively modest $82.3 million deficit in the current budget, he also acknowledged that even the good news hinges on volatile conditions that may or may not improve Connecticut’s outlook in the coming months.

Here are those highlights:

Based on data through October, state income tax receipts tied to paycheck withholding — the single-largest source of state revenue — are up 1.5 percent over last fiscal year.

american flag images 12NEW HAVEN: The Connecticut Department of Veterans Affairs, Vietnam Veterans of America, the VVA Connecticut State Council and the Veterans Legal Services Clinic at Yale launched a first-in-nation program for veterans. Connecticut veterans with “bad paper” discharges are provided new and helpful opportunities to seek discharge upgrades and to connect them with resources to help during the process.

“Bad paper discharges have a terrible impact on veterans’ lives,” said Tom Berger of VVA. “Without upgrades, veterans are barred from the federal benefits they earned through their service, including disability compensation, health care and education, and face barriers to private employment and a lifetime stigma due to their military record.”

Any veterans with below “honorable” discharges can go after discharge upgrades in order to access benefits through administrative boards at the Department of Defense. This process has recently been improved for veterans struggling with post-traumatic stress disorder.

According to advocates for veterans the boards have previously been hostile to post-traumatic stress-based applications and were denied on a “near-categorical basis.” In 2014 then-Secretary of Defense Chuck Hagel highly encouraged boards to give a stronger upgrade consideration to post-traumatic stress evidence that led to veterans’ bad paper discharges.

Through these groups and their collaborative effort, the DVA has mailed out detailed notices to more than 1,000 Connecticut Veterans informing them on how to take advantage of this new program.

Any additional information and resources about the discharge process are available at: CTLawHelp.org/dischargeupgrades.

Coverage Numbers Increase, Big Penalties Come Into Play

By Mark Pazniokas, ctmirror.com

Republicans made stunning gains in state legislative races on election day to force a likely 18-18 tie in the Senate and to leave Democrats with their smallest House majority in three decades, overcoming a Democratic tide at the top of the ticket that carried Hillary Clinton, U.S. Sen. Richard Blumenthal and all five U.S. House incumbents to victory in Connecticut.

With a gain of three seats in the state Senate, the GOP transformed a 21-15 Democratic majority into an evenly divided chamber where ties can be broken by the presiding officer, Democratic Lt. Gov. Nancy Wyman.

With possible recounts in two races, Republicans made a net gain of eight seats in the House of Representatives, leaving Democrats with a probable 79-72 majority when the new General Assembly convenes in January. It is the biggest shift of power in the legislature since the combination of a Ronald Reagan landslide and the party lever delivered a solidly Republican legislature in 1984.

blood 1285894 960 720New FBI crime statistics reveal that violent crime is not only down in many regions, but at its lowest since 1974 in the Nutmeg State, leaving overall crime at its lowest since 1967. Connecticut saw the second most dramatic drop in violent crime of the 9 states boasting such decreases at 8.5%. According to the FBI, this “includes a 2.6 percent decrease in rape, an 8.8 percent decrease in robberies, and a 10.1 percent decrease in aggravated assaults.” 

State officials also note that Connecticut’s prison population is also at a 20-year low. No word on whether retirement-reducing and housing-market-crashing white collar crimes are on decline, though. 

Nutmeg Neighbor Cited As Best State Economy In Nation

By Mitchell Young

BakerMA Malloy CROP

Republican Governor Charley Baker is riding the Baystate’s No. 1 economy to a 74% approval rating.

Connecticut Governor Malloy has the lowest voter approval in the country at 29%

According to GoverningMagazine, which is reaching its 30th year of publication about the nation’s state and local government officials. High taxes, high energy costs, liberal government, and a very high cost of living aren’t the obstacles to a good economy that many in business might think. The magazine chose ultra blue, high tax, high cost of living, high energy costs, overwhelmingly Democratic Massachusetts as the best state economy in the US. Not surprising, the magazine said how much citizens think of their “chief executive” [Governor] is directly related to that ranking.

The current governor, Charlie Baker, is a Republican [liberal for certain] and approved of by 74% of the Commonwealth’s citizens. 

Connecticut’s economy is ranked 42nd by the magazine and the public apparently blames Governor Dannel Malloy, who gets the lowest rating of any governor in the country at 29%. In fact, no other state chief executive comes close to the polled unpopularity
of Malloy.

The once booming state of Arizona, which comes in on the economy scale just one spot ahead of Connecticut, still shows a 45% [popularity] for Governor Doug Ducey. Voters in West Virginia, at the bottom of the economic pack, are not blaming their governor, who has a 60% approval rating.

Fodder for politicians is that the top performing state economies are mostly blue [liberal] or purple states. With only a few exceptions, Connecticut being one at the bottom of the heap, are the red states of Alabama, Arizona, Mississippi, and Louisiana.

Pennsylvania, which has the potential to swing the presidential election, has an economy that is not faring well and is ranked at 37th.

PERFORMANCE OF
U.S. STATE ECONOMIES

 1. Massachusetts

 2. Oregon

 3. Delaware

 4. Colorado

 5. California

 6. Tennessee

 7.  New Hampshire

 8.  Utah

 9.  Virginia

10. Maryland

11. North Carolina

12. Hawaii

13. Florida

14. Idaho

15. Georgia

15. Minnesota

15. Nebraska

15. South Dakota

19. Arkansas

20. Wisconsin

21. Texas

22. Washington

23. Michigan

24. New Jersey

25. Vermont

26. South Carolina

27. Indiana

28. Maine

29. New York

30. Ohio

31. Montana

32. Missouri

33. Nevada

34. Illinois

35. Rhode Island

36. Iowa

37. Kentucky

38. Kansas

39. Pennsylvania

40. North Dakota

41. Arizona

42. Connecticut

43. Alabama

44. Oklahoma

45. Mississippi

46. Louisiana

47. New Mexico

48. Wyoming

49. Alaska

49. West Virginia

   

To determine which states are doing well and which aren’t, Governing looked at six data points from the Bureau of Labor Statistics and the Bureau of Economic Analysis:  state unemployment rate; the improvement in unemployment in the past year; per capita state GDP in 2015;  change in GDP between 2014 and 2015; the percent change in state personal income per capita, from the third quarter of 2015 to the first quarter of 2016; and the percentage growth in year-to-date increases in jobs for 2016.

State economies are moving targets, only two of the top 10 states in the magazine’s 2013 survey, Oregon and Utah, made it to the top ten in 2016. Connecticut, Mississippi and New Mexico, were in the bottom in 2013 and still are.

In ranking a governor’s popularity, the magazine used the results of a 50-state series of gubernatorial approval polls conducted by the online publication Morning Consult between January and May of 2016 and “spot-checked” other gubernatorial approval polls in the past eight months.

The approval ratings for governors of the top 10 states averaged 62.1%, while the gubernatorial approval ratings for those in the bottom 10 averaged 50.8 %.

No governor in the top 10 states had an approval rating lower than 54%, while six of the governors in the bottom 10 states had approval ratings below 50 percent and one – Malloy, had the aforementioned bottom approval rating of 29%.

The magazine cites Tufts political scientist Jeffrey Berry is quoted by the magazine saying Baystaters understand its not just about the new Governor.

“Baker has been in office less than two years and is seen as a positive for the state’s economy moving forward. The Massachusetts economy is in terrific shape, and it’s poised for continued growth,” Berry added, “most voters know that the state’s positive economy is part of a long-term trend that predates Baker.”

Governing reached out to Malloy’s opposition as well, “in Connecticut, where Malloy has the weakest approval rating, residents, may be divided on Yankees and Red Sox, Giants and Patriots, but they are of one mind on Malloy -- he has been a disaster, said Kevin Rennie, a lawyer and a former Republican state legislator who writes on politics for the Hartford Courant was quoted by Governing.

Voters in other states, however, are somewhat more forgiving as reported by the magazine.

In Louisiana, Edwards was only sworn in earlier this year.

“Voters here have a very recent memory of former Gov. Bobby Jindal, who is given much of the blame for the current state of affairs,” said Pearson Cross, a political scientist at the University of Louisiana-Lafayette.

Louisiana, like other states on the bottom 10 list, has also been heavily influenced by a decline in the energy sector. In addition to Louisiana, today’s bottom 10 includes such energy-dependent states as Alaska, New Mexico, Oklahoma, West Virginia and Wyoming. In fact, two of these states -- Alaska and West Virginia -- actually ranked in the top 10 in 2013, before the full force of the energy decline was felt.

Ironically, voters’ understanding of the boom-and-bust patterns in the energy sector may be keeping their governors’ approval ratings higher than they would otherwise be, said several experts.

“Most Alaskans recognize that the state’s heavy dependence on oil production and tax revenues derived from it means that the fiscal health of the state suffers when production is declining and oil prices are low,” said Jerry McBeath, a political scientist at the University of Alaska-Fairbanks. “That’s what most would blame for poor economic conditions now.”

Governors and their approval ratings, in
the top 10 state

 Governors and their approval ratings, in 

the bottom 10 states:

1. Massachusetts Charlie Baker (R)  72 %

2. Oregon Kate Brown (D)  54 %
3. Delaware Jack Markell (D)  66 %
4. Colorado John Hickenlooper (D)  60 %
5. California Jerry Brown (D)  57 %
6. Tennessee Bill Haslam (R)  63 %
7. N Hampshire Maggie Hassan (D) 56 %
8. Utah Gary Herbert (R)  64 %
9. Virginia  Terry McAuliffe (D)  58 %
10. Maryland Larry Hogan (R)  71 

41. Arizona  Doug Ducey (R) 49 %
 42. CT  Dannel Malloy (D] 29%
 43. Alabama Robert Bentley (R) 46%
 44. Oklahoma Mary Fallin (R) 42 %
 45. Mississippi Phil Bryant (R) 60 %
 46. Louisiana John Edwards (D) 45 %
 47. N.Mexico Susana Martinez (R) 48 %
 48. Wyoming Matt Mead (R) 67 %
 49. Alaska Bill Walker (I) 62 %
 49. W. Virginia Earl Tomblin (D) 60 %

 

Methodology

“For each of the six variables, the states were ranked from 1 to 50, with 1 being the best score for that variable and 50 the worst score. Once the 1 through 50 rankings for all six variables were clear, each state’s ranking was added up, double-weighting two of the six measures -- current unemployment and percent change in real GDP -- that was considered the most important. After adding up each state’s rankings, including the double-weighted ones, it was divided by eight to create an overall average ranking for each state. A rank of 1 in each category would produce an average rating of 1.0, while a rank of 50 would produce an average of 50.0. In reality, no state was perfectly strong or perfectly weak. All states had a mix of rankings, with the rankings for some variables higher than others, so the states’ average rankings ranged between 13.3 and 40.6 rather than 1 to 50.”

The survey and attributions are the product of Governing Magazine, which is available at governing.com

standardand poorsConnecticut is “poorly poised” to handle a moderate recession when compared to other states, according to a new analysis by Standard & Poor’s Global Ratings.

The ratings agency evaluated the ability of the 10 most debt-burdened states to respond to significant fiscal stress. It determined the first year of a moderate recession would cost Connecticut $1.15 billion in revenue, which far surpasses the state’s reserve fund, currently about $127 million.

“We believe the state has a good history of mid-year budget monitoring and in recent years has made mid-year budget cuts to restore structural balance,” the report said. “However, structural balance may become more difficult to maintain in a recession scenario due to the state’s rising fixed costs.”

The report found that these “high fixed costs” – tax-supported debt service, pension contributions and other post-employment benefits – would consume a substantial portion of revenue.