A total of $15 million for the ten wealthiest towns, $1.6 million for the ten poorest towns
As the 2011 session of the Connecticut General Assembly comes to an end this coming Wednesday the Malloy Administration will remind us that the phrase that best describes this year’s session is “Shared Sacrifice”
Beginning with the ten times he used the word “sacrifice” in his February budget address, Governor Malloy has been pushing the concept that this budget is all about shared sacrifice. His point, over and over again, has been that we are balancing the Connecticut budget by asking everyone to sacrifice.
And there are a lot of sacrifices in this budget…
But lost in the rhetoric are some stunning examples of just how this Governor defines sacrifice.
First there was income tax proposal in which those making over $2 million a year are asked to pay just .02 percent more a year while the rest of us faced far greater percentage increases. This when the data shows that the wealthiest in Connecticut pay about 4.9% of their income in state and local taxes while those in the middle pay at least 10% of their income in state and local taxes.
Then there is the extraordinary example of Malloy’s plan to help Connecticut’s cities and towns.
While cutting deeply into a variety of programs, Governor Malloy not only maintained the level of municipal aid but proposed doubling the size of the municipal real estate conveyance tax as a way to provide cities and towns with a revenue stream that was separate and above what they received from their local property taxes and state grants.
The budget adopted by the Democrats in the General Assembly included this expanded tax.
While requiring those who sell their property to pay .5 percent of the sales price to their local municipality doesn’t immediately seem unfair, the truth becomes evident when you look at who actually benefits from Malloy’s proposal.
Starting July 1, 2011 – thanks to Governor Malloy and the Legislature’s Democrats – Connecticut’s ten wealthiest towns will share $15 million in new revenue from the expanded real estate conveyance tax.
The state’s ten poorest towns will share $1.6 million.
The benefit per person from Malloy’s plan?
The 203,000 people in the ten wealthiest towns will receive a benefit of $73 per person. All new money to help expand local services or allow the town to cut their local property tax rate.
Meanwhile, the 653,000 people who live in the ten poorest towns will receive a benefit of $2.45 per person providing those communities with no meaningful help in preserving services or cutting taxes.
The Governor and the Democrats could have increased the state portion of the real estate conveyance tax which would have raised a similar amount of money but would have distributed those funds based on need.
Instead, the rich got a break on their income taxes while Connecticut’s wealthiest towns will get an unlooked-for windfall.
Yes, the 2011 Legislative Session may have been about sacrifice but it certainly wasn’t a definition of shared sacrifice that most of us would recognize.