Valley Lawmakers Welcome Two Years Of Federal Funds, Worry About Fiscal Cliff

Connecticut Public Radio | By Ali Oshinskie

Published July 13, 2021 at 6:46 PM EDT

State Senator Jorge Cabrera speaks about investments in the Naugatuck River Valley from the state budget. The two-year budget relies on one-time federal COVID relief funds and some are worried about the fiscal cliff that will create.

Cities and towns around the state are seeing record levels of funding from COVID relief funds and the state budget this year. But lawmakers in the Naugatuck River Valley worry what happens when the sugar high of federal dollars wears off.

Federal COVID relief funds helped to bolster the state budget this year. But there’s a problem with this source of funding according to Republican Rep. Nicole Klarides-Ditria of Derby, Beacon Falls and Seymour. “We really feel that this is going to set us up for a budget shortfall in 2 years,” she said,

Thanks to the federal funds, some $2 billion went to cities and towns directly. On top of that, the state got about $3 billion from Uncle Sam, which added to the bottom line of the budget.

But that’s all one time money. The state budget used some of that to expand or create new programming, in the two-year budget. But after 2023, it’s anybody’s guess how those programs will be sustained.

On the other side of the aisle and the other chamber of the legislature, Democratic state Sen. Jorge Cabrera is also worried about the financial cliff. “The structural underpinnings of the inequality we have in Connecticut have yet to be addressed,” he said.

Cabrera thinks one way to balance the budget two years out might be in taxing higher income individuals and corporations, saying “I think we seriously need to look at tax reform.”

Republican Rep. Jason Perillo of Shelton is also thinking about taxes. He says what he would have liked to have seen, “in order to control that additional spending, was actually to roll back and increase certain tax credits.” He would have avoided increasing spending with the COVID funds and put that money directly in the residents’ pockets.

On the other hand, Democrat Ansonia and Derby Rep. Kara Rochelle is most happy to see the state make its big strides in paying off debt. She says the state is “making moves so that we can continue to invest the way that we’ve been able to invest this year.” Rochelle thinks this surge of spending is an investment in the valley and the state that will pay off for years to come.