Gov. Ned Lamont is proposing an ambitious universal pre-school program that would be free for all families making less than $100,000 a year.

It’s the highlight of the new $55.2 billion, two-year state budget he unveiled on Tuesday, which also includes modest tax cuts but higher fares on Metro-North trains.

Democrats and business groups applauded the pre-K proposal, but Republicans slammed Lamont for creating a “slush fund” to pay for it.

Paying for child care is a struggle for working parents – and that’s if you can even find a spot.

In his budget address, Lamont rolled out an ambitious universal pre-school proposal.

“Providing pre-K and pre-school spaces at no cost for all families earning up to $100,000,” Lamont told lawmakers. “Saving parents thousands of dollars and giving them the freedom to get back to work – because parents, our businesses need you.”

Business groups like the idea.

“While it’s an ambitious plan, it’s certainly one that’s needed,” said Connecticut Business & Industry Association president Chris DiPentima. “But there’s other ways to fund it.”

Paying for Lamont’s universal pre-school program will be a major fight.

He wants to loosen the state’s Volatility Cap, which prevents lawmakers from spending “volatile” tax revenues like stock market gains. But some of those funds have proven to be consistently stable since the cap was created in 2017.

“I continue to be a strong believer in the spending cap, which simply restates the obvious. You can’t spend more than you earn,” Lamont said. “That being said, we have earned the opportunity to rethink the volatility threshold.”

Lamont’s budget would divert $300 million in budget surpluses into a new Universal Preschool Endowment, which would operate outside the state’s strict spending caps, known as “fiscal guardrails.”

Republicans slammed the idea.

“He’s creating gimmicks to get around the spending cap,” said Connecticut Senate Republican leader Stephen Harding (R-Brookfield). “Three billion dollars in increased spending, blowing past the guardrails, playing fiscal gimmicks, creating slush funds. No relief – no relief on energy."

Loosening the Volatility Cap requires a 60% vote of the Legislature. Top Democrats said it’s the right decision.

“We’re making an investment in something that’s going to grow Connecticut's economy, to get more people back at work, create more tax revenue,” said House Speaker Matt Ritter (D-Hartford).

But beyond the major investment in child care, Lamont’s budget is lean and cautious – a nod to the uncertainty about cuts from the new Trump administration.

“The last few weeks have been turbulent, and we can only guesstimate how changes in Washington will impact our budget over the next few months,” Lamont said. “Our proposed budget is our best effort to stay true to our Connecticut values while continuing to focus on affordability and opportunity for all.”

The governor is proposing modest tax cuts, including an extra $50 credit for local property taxes that would also apply to more homeowners. Small businesses and start-ups would see some tax relief, too.

The proposal also calls for capping generic drug prices at the rate of inflation.

“Our budget also includes funding to import pharmaceuticals from Canada at less cost – unless higher tariffs kill this option,” Lamont quipped.

In some areas, Lamont’s budget would cost you more. Metro-North train fares would go up 5% this summer and an additional 5% next year. Bus fares would rise $2 in July 2026.

Lamont’s budget also ends free text messaging at state prisons, but inmates would still get free phone calls. He is also proposing state borrowing to build new courthouses in Bridgeport and New Haven.

“He hasn’t solved any problems with this budget,” said House GOP leader Vin Candelora (R-North Branford). “He’s done nothing for electricity costs. He’s done nothing for public safety. He’s doubled down on immigrants.”

One day earlier, state Senate Republicans called for sweeping tax cuts on the first $100,000 of your income. Two years ago, Lamont signed the first income tax cut in nearly three decades.

Lamont is offering local school districts relief, which could reduce pressure on local property taxes. His budget includes $54 million extra in the second year for special education, which eats up one-third of some school districts’ budgets.

“Addressing special education is also property tax relief,” said Hartford Mayor Arunan Arulampalam. “It’s not just about special education aid. It’s about building stronger education systems for all of our children and reducing the property tax burden on all of our towns.”

But Connecticut’s public colleges and universities aren't as lucky. They would see less money overall, now that federal pandemic relief has ended.

The governor had a pointed message for Connecticut State Colleges and Universities, which was the subject of a recent scathing audit.

“Their student population is down 30%, most students don’t graduate and costs keep escalating,” Lamont told lawmakers. “The university boards and leadership should be drilling down on the mix of courses, size of lectures and teaching load. You can’t teach innovation if you’re hesitant about innovating.”

Outside the Capitol, dozens protested the Trump administration.

“Idiocy going on in Washington,” said one protester from Glastonbury. “Got to do something about it.”

But the new president could blow up the state budget. He has promised deep cuts in federal funding. And Tuesday, new Attorney General Pam Bondi ordered the Justice Department to halt all funding to “sanctuary cities” that refuse to cooperate with federal immigration agents.

That puts a target on Connecticut. The state’s TRUST Act limits police cooperation with immigration officials.

In his budget address, Lamont promised to protect immigrants.

“We don’t waste time on the immigration status of speeders and shoplifters, and our teachers don’t ask the immigration status of their students,” Lamont said. “And while we are securing the southern border, we also remember that the Statue of Liberty is not some old, rusted steel relic. It’s a symbol for dreamers around the world, yearning to breathe free.”

This is just the starting point of the budget debate.

Over the next two months, the General Assembly’s budget committees will craft their own tax and spending plans. Then lawmakers will negotiate a final deal with Lamont by June. The new budget year begins on July 1.

But that might not be the end of it.

Given the uncertainty over federal funding, top lawmakers said they may have to return to Hartford for a special session in the fall to adjust the budget.