'Enough is enough.' CT lawmakers poised to set aside $500 million to cover cuts from Washington
Gov. Ned Lamont will have broad authority to spend money from the Federal Emergency Response Fund, but top lawmakers from both parties could reject his decisions.
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Despite a possible deal to end the 40-day federal government shutdown, Connecticut lawmakers are poised to set aside $500,000,000 this week to make up for cuts from Washington.
Gov. Ned Lamont would have broad authority to spend the money, but only temporarily – and legislative leaders from both parties could reject his decisions.
“ENOUGH IS ENOUGH”
The shutdown has already forced Connecticut to spend tens of millions of dollars to keep programs like SNAP food assistance going. And there is still uncertainty about funding for health insurance and the Low Income Heating Assistance Program (LIHEAP).
To plug those potential gaps, state lawmakers plan to set aside a $500 million Emergency Response Fund during a special session on Wednesday and Thursday. The money comes from budget surpluses and will be added to the state’s $4.3 billion “Rainy Day Fund.”
“SNAP and WIC alone – that’s probably $73, 74 million right there. LIHEAP, you could be into the 80s a month,” said House Speaker Matt Ritter (D-Hartford). “I don’t know what goes on in Washington. I’m not here to lambaste anybody or criticize anybody. But in Connecticut, you have a culture where people of all parties said, ‘Enough is enough.’”
LIMITS ON SPENDING
Lamont will have discretion spend the money – within certain limits.
“There's a leap of faith here. You know, we are putting $500 million into the hands of the governor to mitigate this crisis,” said Connecticut House GOP leader Vin Candelora (R-North Branford). “It's enumerated for federal cuts essentially, that it’s to be used for. There’s a laundry list of about six items that the governor can identify.”
Lamont could only use the money for things like health care, as well as food and energy assistance. And the Legislature’s six top leaders – from both parties – can reject any spending from the fund with a simple majority.
“So I would be making a recommendation saying, ‘This is how I’d spend money on WIC, on SNAP and on LIHEAP and on other priorities we may have,” Lamont said. “And then that would go to the legislative leadership on both sides of the aisle.”
The fund expires on Feb. 4, when lawmakers reconvene for the regular legislative session.
Legislative leaders said the fund is needed even if the shutdown ends, because the government could shut down again in January. Lamont would retain the spending authority through
HEALTH INSURANCE SPIKE
One big question: Will the fund cover a big jump in Affordable Care Act premiums, which are set to hit more than 33,000 Connecticut residents in January?
“I met with a couple in Ridgefield that was seeing their health insurance costs go from $900 a month to $4,000 a month,” said Rep. Jim Himes (D-4th District). “They can’t do that.”
Premiums will rise because pandemic-era subsidies expire at the end of the year. In Washington, the shutdown deal does not include a guaranteed vote on extending the subsidies.
Connecticut’s two senators said they cannot support the agreement.
“I am unwilling to accept a vague promise for a vote at an indefinite time on an indeterminate bill,” said Sen. Richard Blumenthal (D-Conn.). “Millions of Americans, and tens of thousands in Connecticut, are forced to make impossible choices right now about what health insurance they can afford.”
Lamont said replacing the Obamacare subsidies would cost the state $350 million alone.
“I’m very hopeful that the feds are going to come up with a solution that doesn’t penalize our people,” he told reporters. “I can’t make any predictions about the federal government.”
IMPACT ON PENSIONS
The $500 million in budget surplus was scheduled to help pay down Connecticut long-underfunded pensions. But State Treasurer Erick Russell said that buffering cuts from Washington is a smart use of the money that does not violate Connecticut’s bond covenants.
“It’s in line with what we’ve done in terms of being fiscally responsible as a state,” he said. “Creating additional reserves, having that flexibility is fiscally responsible.”
Russell added that, even with the diversion, the state is paying down $1.2 billion in pensions this year. And any unused money will go back into pensions when the current fiscal year ends in June 2026.
Social services groups praised the move but are pushing for even stronger action.
”State leaders must follow today’s announcement with actions to strengthen SNAP and HUSKY in the special session and 2026 legislative session, because the threats to working class people aren’t only about funding and unfortunately don’t end this week,” said Garth Harries, president and CEO of The Connecticut Project Action Fund. “The federal budget’s cuts and meanspirited changes to SNAP and HUSKY are the other shoes about to drop, and working-class people will be the first to suffer if our state hasn’t acted.”
