Politics & Government
Preserving the guard rails is a ‘top priority’
State Sen. Fazio also supports zero-based budgeting
By Scott Benjamin
“The fiscal guard rails are the greatest legislative achievement in state government in the last decade.”
Why does state Sen. Ryan Fazio say that?
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“Because they changed the overspending and the overpromising,” Fazio (R-36) of Greenwich remarked in a phone interview with Patch.com. “You cannot commit the sins of the past in the future.”
“Connecticut is the second highest taxed state in the country,” he declared. “That is because of the many years that politicians in Hartford have overspent, over-promised and over-borrowed.”
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The guard rails were enacted in 2017 as budget deliberations stretched almost to Halloween. There is a spending cap and also a volatility cap that directs surpluses and capital gains revenue toward the rainy-day fund and for paying down a pension debt that recently advanced from being the third worst in the country to the sixth worst.
Fazio won a third term last November in an expensive campaign in which his Democratic opponent boasted that he was a “Ned Lamont Democrat.” In fact, Nick Simmons of Stamford had been Gov. Lamont’s (D-Greenwich) deputy chief of staff in early 2024 when he entered the contest in the district that encompasses all of Greenwich and parts of New Canaan and Stamford.
Yet, in the interview Fazio praised some of Lamont’s positions, saying, “on economic issues, generally, he has been a responsible steward. I think his defense of the fiscal guard rails has been of enormous benefit for our state.”
Fazio said he expects there likely will be a collision on maintaining the guard rails during the upcoming session of the General Assembly between Lamont and the Democratic House and Senate caucuses – both of which have slightly better than a two to one majority. Some Democratic legislators want more money available for education and social programs.
State Rep. Bob Godfrey (D-110) of Danbury, the deputy House speaker pro tempore, recently told Patch.com that he expects there will be a vote on altering them during the 2025 session. In 2023 the guard rails were extended for another five years.
Fazio, who has a bachelor’s degree in Economics from Northwestern University, said, “Preserving the guard rails” as they are is a “top priority. Preserving them will determine whether it will be tomorrows’ tax increases or tax cuts.”
State Comptroller Sean Scanlon (D-Guilford) also has defended the guard rails. Beyond that, he recently told John Dankosky of CT Mirror that the state should enact zero-based budgeting.
Scanlon commented, “I believe that the best thing we can do is blow up the way we do our budget, start from zero, figure out whether the things that we’re spending money on are actually getting the ROI that we think they are, and as a result of that, free up tens of millions and hundreds of millions of dollars to actually meet the needs. There’s a way to meet in the middle. Nobody is addressing it from that perspective. They’re just saying, ‘Well, let’s just get rid of the guardrails, and then we’ll be able to solve all our problems.’ I think that that’s a little short-sighted.”
Fazio, the ranking Republican senator on the Finance, Revenue and Bonding Committee, also supports zero-based budgeting, saying, “Every single ounce of taxpayer dollars and government spending should be justified before it has been spent. “It should not be there just because it was there in the past.”
Would it be difficult to convert to zero-based budgeting?
“I don’t think so, because we have an appropriations process and a budget process,” Fazio commented. “Every single dollar that is being proposed should be justified every two years. That is something that households do, all businesses do, and it should be something that state government does.”
Over the last dozen years, Republican gubernatorial candidates John McKinney of Fairfield, Tim Herbst of Trumbull and David Stemerman of Greenwich have advocated for the establishment of an Office of Inspector General with a team of forensic auditors. Herbst, the former first selectman of Trumbull, told Patch.com in 2018 that a similar office in the federal government has more than paid for itself through identified cost savings.
Fazio said he “would likely support it depending on the details. Even to present day, this state and its bureaucracy has mismanaged billions in taxpayer dollars from the state pier that cost over three times the initial cost, to the school construction scandal, to the West Haven ARPA scandal, to the CSCU [Connecticut State College and Universities] scandal and beyond. The public needs and deserves an effective watchdog and I am open to this idea for that reason.”
On a related topic, Fazio said he commends state Treasurer Erick Russell, a Democrat, for installing reforms recommended nearly two years ago in a report by a team of researchers from Yale on the performance of Connecticut’s state pension investments.
“I do appreciate that this treasurer has made changes in some of those procedures,” commented Fazio. “I think that has improved pension performance since he got into office” in early 2023.
However, Fazio as well as Hartford Courant columnist Kevin Rennie have questioned why those changes have not been made permanent through legislative action.
Rennie recently wrote,” Russell has presided over significant improvements in the funds’ returns, but he will not always be the treasurer.”
Fazio commented, “This is not about the [current] treasurer, who I think has made sound decisions. It is about the next five or 10 treasurers.”
He said the treasurer’s office should have a permanent Board of Directors that has a shared fiduciary responsibility for the pension investments.
“We are one of only two states, the other being North Carolina, where the treasurer is the sole fiduciary” Fazio remarked.
He added that North Carolina has had the worst pension performance over the last 10 years.
Said Fazio, “A Board of Directors with a shared responsibility would have saved the Connecticut taxpayers billions and billions of dollars.”
Patch.com contacted the press office of the state Treasurer’s office via e-mail on Monday, December 30, to offer an opportunity for comment on Fazio’s remarks. There apparently was no reply.
On another subject, State Senate Republican Leader Stephen Harding (R-30) of Brookfield has called for at least a two-year freeze on the salaries of the state employees, whose contract will be renegotiated in 2025. He said that they have gotten accumulated increases of 33 percent over the last six years, far more than workers in the private sector have received.
Regarding the proposed salary freeze, Fazio commented, “I think that is responsible.”
Harding has said that the 2017 contract placed the new hires under a less-expensive hybrid pension system from the direct benefits plan that the veteran state employees have. He has suggested that the state needs to move toward having the new hires have a direct contributions plan, which would be even less expensive on taxpayers.
Fazio said, “Almost all new private sector workers in the United States have defined contribution plans like 401ks. For new employees, Connecticut is moving in that direction but is not entirely there. That should inform how we compensate employees in the state government going forward.”
Harding also has said that state employees should be doing more work in their offices and less work from home.
Fazio said, “I think there should be more in-person, more in-office. There is so much evidence in private sector businesses that productivity is so much higher [in the office] than it is when it is remote.”
Connecticut’s minimum wage has been going up steadily for more than a decade. On January 1 it reached $16.35 per hour, more than a six dollar per hour increase since early 2017.
Fazio commented that he is “concerned that it will create unemployment for lower-skilled workers and younger workers.”
“A higher minimum wage is passed on in higher prices,” he added. “We should have a minimum wage, but we should be careful about increasing it.”
On another topic, Fazio said there is a possibility that states, including Connecticut, will receive less federal funding under Republican President-elect Donald Trump.
“As state officials we need to be reactive,” he said. “Connecticut is a donor state. We don’t get as much money as we send out.”
Fazio was one of the prime sponsors of legislation that requires state employee jobs that don’t absolutely require a college degree to be advertised as such. Lamont signed the legislation in July 2023, making Connecticut one of a handful of states to enact that reform.
“Talent is distributed more broadly than the 40 or so percent of the population that has a college degree,” said Fazio. “This will give more opportunities to people in Connecticut.”
Fazio supported the 2023 bipartisan reduction in income tax rates. Under the plan, rates for the middle class went down from five percent to 4.5 percent and for the lower income the rate decreased from three percent to two percent.
He said he estimates it saved about $300 a year for the “average household.”
“It is necessary,” he explained. “It is not sufficient.”
State Sen. Eric Berthel (R-32) of Watertown has called for a reduction in the state sales tax from 6.35 percent to 5.99 percent.
Fazio said, “I support tax cuts. I would prefer to see income tax rate reductions and limits on property tax growth,”
What are the prospects for job growth in Connecticut, which reportedly has fewer jobs now than it did in 1989?
Fazio explained that as legislators “our job is to create a fertile ground for any and all industries to succeed without showing strong bias to one versus another.”
However, he added that he has “always believed that if we reform health care policy in the state, especially Certificate Of Need laws, that we could create innovation and new jobs in health care. I believe that if we ease the state's sprawling regulations that it would help small business grow. On the other hand, without cutting energy costs, I do not see any possibility for growth in manufacturing or heavy industry in the state. Hopefully with the right reforms we can make these parts of the economy succeed and more”
Fazio is the ranking Republican senator on the General Assembly’s Energy and Technology Committee, and said he is “on the face of it” pleased with the recent announcement by Lamont of three new solar projects by the state and Connecticut’s first grid-scale electricity storage project. He said he is encouraged that they are less expensive than off-shore wind energy.
He and Harding distributed a news release indicating that Lamont made the decision because he didn’t have answers that Republicans had been asking regarding the costs related to off-shore wind power.
Jamil Ragland of CT News Junkie reported that, the state Department of Energy and Environmental Protection “estimates that the projects will save Connecticut ratepayers $424 million in energy supply costs, net of the costs of the contracts, in the first 20 years of operation. That comes out to about a $0.57/month reduction for the average residential customer electricity bill.”
Remarked Fazio, “I’m still concerned about the purchases that were made December 20].The public has a right to know how much they’re paying for the solar and battery costs. We need more transparency on the pricing of alternative energy options.”
Fazio’s 2024 campaign web site underscored a six-point energy reform package, which included a provision for, “Capping state-directed electricity purchases at no more than 150% above the competitive wholesale market price for electricity.”
He said he is disappointed that the Republicans’ petition this summer to hold a special session on energy costs didn’t have enough support to be held. He said the state should seek to eliminate the public benefits charges on consumers’ electricity bills, which is part of his six-point plan.
Resources:
Phone interview with Ryan Fazio, Patch.com, on Friday, December 27, 2024.
E-mail interview with Ryan Fazio, Patch.com, on Monday, December 30, 2024.
https://ctmirror.org/2024/12/05/sean-scanlon-in-the-room/
https://www.greenwichsentinel.com/2024/09/06/lamont-and-fazio-meet-skyrocketing-electricity-bills/
https://www.ryanfazio.com/copy-of-local-control-of-zoning
https://ctnewsjunkie.com/2024/12/20/deep-announces-selection-of-4-new-clean-energy-projects/
https://ctmirror.org/2024/09/22/ct-ryan-fazio-greenwich-2024-election/
https://patch.com/connecticut/brookfield/harding-wants-freeze-state-employee-wages-least-two-years