The first unabashed economic bill filed this month in Connecticut”™s 2008 legislative session was a proposal to create a “responsible growth” cabinet.
Growth would be nice after the Connecticut Office of Fiscal Analysis slashed its surplus projections by $100 million.
Gov. M. Jodi Rell introduced few new major business or economic initiatives to rival her ballyhooed education and transportation reform packages of 2007.
Aside from a proposal to cap property tax increases, the governor instead is tinkering with minor adjustments, such as eliminating a $250 annual tax on business entities. Rell and others are hopeful that Connecticut will fare better than other parts of the Northeast and nation in the current downturn.
“With economic storm clouds on the horizon, it”™s more important than ever that we focus on economic development,” Rell said Feb. 6 in her annual State of the State address.
That focus will gain a new edge if the governor gets her way. Rell wants to create a “responsible-growth” cabinet to grill developers on any projects involving 250,000 square feet of commercial or industrial space; 500 residential units; or 1,000 parking spaces. Developers incorporating transit links and other criteria could apply for state funding to push the project along.
Rell”™s cabinet members would be chaired by the secretary of the Office of Policy and Management, and would include the heads or designees of the:
Ӣ Commission on Culture and Tourism;
Ӣ Connecticut Development Authority;
Ӣ Connecticut Housing Finance Authority;
Ӣ Connecticut Innovations Inc.;
Ӣ Department of Agriculture;
Ӣ Department of Economic and Community Development;
Ӣ Department of Environmental Protection;
Ӣ Department of Public Health;
Ӣ Department of Transportation; and
Ӣ Office of Workforce Competitiveness.
Rell has met twice in the past few weeks with her council of economic advisors, whose chairman is Donald Klepper-Smith, chief economist for DataCore Partners L.L.C. There is a possibility of job losses in the insurance and financial services sector, according to Klepper-Smith, adding that Connecticut”™s tax collections depend heavily on the performance of Wall Street, and suggesting the impact of the housing slump has yet fully to play out.
“Since (late January) there are ”¦ companies that are having troubles in collections, particularly those that deal with consumers,” said Peter Gioia, another economic advisor who is vice president and economist of the Hartford-based Connecticut Business and Industry Association. “All of us were in agreement that Connecticut is likely to outperform the U.S., however ”¦ The (Connecticut) coast from Rhode Island to New York is the least vulnerable to a recession, including (Fairfield County).”
In an economic forecast last week, the Connecticut Center for Economic Analysis at the University of Connecticut agreed that the state could skirt a recession. CCEA nevertheless predicted Connecticut will see “significant and growing” job losses in manufacturing and more modest job losses in construction and government.
Besides the business entity tax repeal and the property tax cap, Rell proposals that could directly impact corporate bottom lines include a corporate tax credit for companies that offset greenhouse gas emissions.
Rell also wants to add three weekend shifts at the freight weigh station on Interstate 95, and target companies that have a history of failing truck-safety inspections. That might encourage some truckers to detour to Interstate 84 to bypass the Greenwich station, in theory alleviating overall congestion on I-95 though slowing traffic during inspection times as truckers pull into and out of the station.
On the recommendation of Michael Critelli, the former CEO of Pitney Bowes Inc., Rell wants to break the state Department of Transportation into two new agencies: a Department of Highways and a separate Department of Public Transportation, Aviation and Ports.
