Home Economy Conn. lawmakers to return next week for final budget tweaks

Conn. lawmakers to return next week for final budget tweaks

State legislators will return to Hartford next week to revise various portions of the recently passed state budget, including the controversial proviso regarding the hospital tax, which was line-item vetoed by Gov. Dannel Malloy.

budget connecticut state senate
The Capitol building in Hartford.

Malloy signed the budget on Oct. 31, but nixed the hospital tax proposal, citing what he called its unsound legal basis in federal law. He then asked lawmakers to pass what he called “the workable language” his administration had provided to “make the proposal legal and successful.”

The governor and his administration have told legislators that language concerning the hospital tax could put about $1 billion in federal funding at risk. The federal revenue is tied to the tax as part of a complicated reimbursement formula.

Hospital taxes collect and redistribute revenue from hospitals, nursing homes and other such health care providers. The Connecticut tax would apply to hospitals and ambulatory surgery centers.

The state’s proposed hospital tax would collect about $900 million per year, up considerably from the current $556 million. The state would then redistribute those funds and return them to the industry, along with about $229 million, to qualify for federal aid. All told, the tax would result in about $137 million for Connecticut.

The Senate tentatively is scheduled to vote Nov. 14, to add new language in the hospital tax proviso, as well as to revise a rental housing rebate program, a Social Security-related income tax deduction, and a bonding issue. The House of Representatives is scheduled to vote the following day.

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