Poll: 63% Of Voters Want CT To Save Less, Spend More on Services

More than 60% of likely Connecticut voters would modify the state’s savings programs to spend more on human services, health care and education while still paying down state pension debt faster than the required pace, according to a new poll released Wednesday from private, nonprofit social service agencies. The survey, conducted by San Francisco-based Change Research, also found 68% of likely voters support scaling back state savings programs to boost funding for the community-based nonprofits that deliver the bulk of state-sponsored social services for people with disabilities and patients struggling with addiction or mental illness.

But Gov. Ned Lamont’s administration called the poll questions “biased” and said Connecticut already has made “significant progress” investing in core services even as it has reduced its debt. Lamont, a fiscally moderate Democrat, is one of the strongest advocates for budget controls at their current settings, often calling them the state’s “fiscal guardrails.”  Gian-Carl Casa, president and CEO of the CT Community Nonprofit Alliance, said there’s room for change.

“This polling shows that voters believe community nonprofit funding should be increased, and if necessary, the guardrails should be updated to do so. They understand it isn’t an either-or choice.” Casa, whose organization spent $10,600 to commission the poll, added that “Voters believe the state should better balance its spending so it both pays down debt and invests in the people who depend on health and human services. We look forward to sharing that message with lawmakers in the coming months.” 

Change Research, which surveyed 756 likely voters online between July 15 and 19, asked, “How should Connecticut spend its consistent and large budget surpluses?” About 63% of those polled selected the response: “Put some of it toward paying down pension debt and some toward funding health and human services, education and other priorities.”

Other respondents and the answers they selected include:

• 17% who chose “Put it all toward funding health and human services, education and other priorities;”

• 12% who chose “Not sure;”

• 8% who chose “Put it all toward paying down pension debt for state employees.”

The poll has a 3.7 percentage point margin of error.

Since 2017, when new legislators from both parties approved a series of new budget controls, the state has increased its rainy day fund from $212 million — or roughly 1% of the General Fund at that time — to $4.1 billion or 18%, the maximum allowed by law. It also has used another $7.6 billion in surpluses since 2020 to pay down pension debt and is scheduled to dedicate another $850 million from the 2023-24 windfall for that purpose this fall.

The chief engine of those surpluses is a program that allows lawmakers to spend only a portion of quarterly income and business tax receipts on the assumption those revenues fluctuate too much year-by-year. But critics say this “volatility adjustment” is calibrated too poorly and takes a huge chunk of funding out of the budget every year. In its first seven years, the volatility adjustment has captured an average of $1.4 billion annually — equal to more than 6% of the current General Fund — less than $950 million only once, and never less than $530 million. 

The state entered this year with more than $37 billion in unfunded pension obligations, an enormous mess created by more than 70 years of improper savings between 1939 and 2010. Pension debt is expected to keep heavy pressure on state finances well into the next decade. Collibee added that “Our community non-profit providers deliver important services in the community for Connecticut residents. And we recognize that, like everyone else, they face inflationary pressures.”

Lamont and legislators used $50 million in temporary, federal pandemic grants to bolster payments to nonprofits this fiscal year, equal to a 2.5% rate increase. But that’s a small portion of the $480 million the industry says it loses annually because state payments haven’t kept pace with inflation for a decade-and-a-half. Also, that $50 million was just a portion of the nearly $700 million in pandemic grants or other temporary funds legislators and the governor used to cover ongoing operational costs in social services, higher education and other core programs. That leaves a huge fiscal hole to fill next spring when they craft the next state budget. But with the volatility adjustment projected to capture $1.2 billion in unstable revenue, some legislators and other advocates for programs say Connecticut could use some of that to meet service needs and have big dollars left over to pay down debt.

Lamont’s fellow Democrats in House and Senate majority leadership have said some adjustments to the savings programs likely will be necessary starting next year. The State Employees Bargaining Agent Coalition, which represents nearly all major unions in state government, also has been pushing Lamont and the legislature to scale back savings efforts. 

But the governor isn’t alone in defending the current configuration. Republican minorities in both chambers back the status quo. “The responsible fiscal guardrails that Republicans fought to put in place in 2017 have injected fiscal discipline into government spending, enabled tax cuts and lowered our debt,” Senate Minority Leader Stephen Harding, R-Brookfield, said after the poll was released. “ … Abandoning that fiscal discipline will return Connecticut to the infamous ‘permanent fiscal crisis’ we were in only a few short years ago.”

The president of the conservative Yankee Institute for Public Policy, Carol Platt Liebau, noted that required annual pension contributions are $650 million less than they otherwise would have been because of the surplus dollars they’ve received since 2020. Things might have otherwise been worse for social services and other core programs. 

“The guardrails are working, so why on earth would we change course now?” she said.