May 10, 2018 / 7:26 PM / 11 days ago

In budget deal, Connecticut lawmakers leave rainy day fund with $1.1 bln

NEW YORK, May 10 (Reuters) - Connecticut lawmakers reached a last-minute deal to adjust the state budget just before their legislative session ended at midnight on Wednesday, agreeing to restore aid to municipalities and leave the state’s rainy day fund with $1.1 billion.

“It took compromise on all sides,” said Speaker of the House Joe Aresimowicz, a Democrat, at a televised bipartisan press conference late on Wednesday. “I’m really happy and really proud.”

The deal adjusts the second year of the state’s $41.3 billion biennial budget, which finally arrived four months late in October after an unusually contentious legislative session.

The two-year budget is adjusted to match up with revised revenue estimates in the second year.

“I will review the budget in full over the coming days,” outgoing Governor Dannel Malloy told lawmakers just after midnight. Malloy, a Democrat, is not seeking reelection this year, and this was his final address to the joint session.

“I leave the (office) with a hope and a belief that Connecticut can focus on fiscal discipline and restraint in the years ahead,” he said, calling the job of governor “the honor of my lifetime.”

The revised budget appropriates $20.86 billion for fiscal 2019. It restores a Medicare savings program for low-income disabled and elderly patients and puts money towards magnet and vocational schools.

The budget also gives a 1 percent cost of living increase to private nonprofit service providers.

Lawmakers added $1 billion for new infrastructure in the state’s highway system, but they dropped a proposal to increase tolls on trains and buses.

Connecticut legislators, like those in New York and New Jersey, also allowed state and local property taxes to be filed as charitable contributions to offset federal tax law changes.

Helping to grease the wheels of the budget process was an unanticipated windfall of $1 billion in state income tax revenues.

Even so, the state did not have consensus revenue forecasts until April 30, giving the legislature less than two weeks to craft budget adjustments before the end of their session. (Reporting by Hilary Russ Editing by Chizu Nomiyama)

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