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Capitol Week in Review: Republicans and Democrats fight over UTC headquarters departure

Capitol Week in Review: Republicans and Democrats fight over UTC headquarters departure

The Capitol complex in Hartford was eerily quiet last week as lawmakers took some time to decompress after the legislative session ended June 5. But the partisan sniping didn’t stop, with Republicans and Democrats wrangling over the departure of another corporate headquarters and the as-of-yet-unsigned state budget. There was some reprieve from talk of tolls, but Gov. Ned Lamont plans to meet with legislative leaders this week to continue negotiations ahead of a planned vote on tolls in a special session. No date for that session has been set yet.

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The big story

UTC HQ to Boston: United Technologies Corp. is moving its headquarters from Farmington to Greater Boston, taking about 100 high-paid executives with it. The move comes as UTC merges with Waltham, Mass.-based Raytheon Co., a major defense manufacturer, to form Raytheon Technologies. The loss of another corporate headquarters stings, and Republicans in the General Assembly blamed the state’s tax policy. Democrats said the departure was a business decision, and noted that Massachusetts is not a cheaper place to do business. UTC CEO Greg Hayes confirmed that later in the week, saying Wednesday it was “patently false” the headquarters was moving because of high taxes. Civic leaders said Connecticut can’t compete head-to-head with Boston in many categories, but the state must focus on selling its strengths. Meanwhile, business leaders said Connecticut legislators must double down on job training efforts to prepare for new jobs generated by the merger.

Five things you may have missed

Republicans say budget isn’t balanced: GOP legislators ramped up their criticism of the two-year, $43 billion state budget last week, arguing nearly $460 million in state employee savings counted on to balance the budget are based on agreements with unions that haven’t been reached yet. Senate Republican leader Len Fasano of North Haven called the budget unconstitutional and urged Lamont to veto it. At a news conference about half an hour later, Lamont pledged to sign the budget bill and said Republicans should be thanking him for the savings he was able to realize by refinancing pension payments and trimming health care costs. The governor’s budget director, Melissa McCaw, said most of the savings don’t need to be negotiated with the unions and there was nothing unusual about a budget including savings targets.

UConn arts administration professor Elizabeth Athens photographs her graduating MFA students (from left) Margaux Ancel, Caitlin Healy and Katrina Foy, with Foy's daughter Sophie watching from her carrier, at the UConn sign installed May 4 adjacent to Route 195 on the north end of campus.
UConn arts administration professor Elizabeth Athens photographs her graduating MFA students (from left) Margaux Ancel, Caitlin Healy and Katrina Foy, with Foy's daughter Sophie watching from her carrier, at the UConn sign installed May 4 adjacent to Route 195 on the north end of campus. (Mark Mirko / Hartford Courant)

Unfunded pensions drive UConn budget gap: The state’s chronic underfunding of state employee pensions is causing consternation at the state’s flagship university, where officials say budgets would be balanced if it weren’t for massive pension payments that are required to catch up for the decades when retiree benefits weren’t properly funded. The budget gap for UConn was $19.6 million. The deficit at UConn Health was $7.1 million but would have been far greater if state legislators had not agreed to an additional $33.2 million to cover pension costs at the health center in the final days of budget negotiations. UConn is in the fourth year of a four-year tuition increase plan, and while no additional tuition hikes are planned, officials did not take that option off the table.

Feds squash Connecticut’s tax workaround: The Treasury Department has issued regulations that effectively kill legislation enacted in Connecticut last year that would have allowed state residents to donate to a nonprofit established by their city or town and receive a local property tax credit in return. The legislation was seen as a workaround to a $10,000 cap on state and local tax deductions that was included as part of President Donald Trump and Republicans’ federal tax reform. The cap disproportionately impacts taxpayers in high-tax states, who often write off far more than $10,000 in state and local taxes. Charitable donations remain uncapped. The Treasury Department has yet to weigh in on a separate tax workaround that allows small business owners in Connecticut to take bigger federal deductions.

President Donald Trump boards Air Force One before departing from Offutt Air Force Base in Nebraska on Tuesday.
President Donald Trump boards Air Force One before departing from Offutt Air Force Base in Nebraska on Tuesday. (MANDEL NGAN/Getty)

Courtney nixes Air Force One paint job: Rep. Joe Courtney, D-2nd District, dealt a blow to President Donald Trump’s plans to repaint Air Force One red, white and blue during negotiations over Pentagon spending last week. An amendment he authored, which would require congressional approval for excessive spending on “interior, paint and fixates” for the aircraft, was adopted on a party line vote. Trump made an off-hand remark about a year ago that he wanted a red, white and blue paint scheme on the iconic Air Force One and mentioned outfitting the plane with gold-plated fixtures like those at Trump Tower in New York City and Mar-a-Lago in Florida. Courtney, in introducing the amendment, said additional paint can add weight and new fixtures can increase costs or cause delays in the new Air Force One planes being delivered.

Ideanomics project stalls in West Hartford: Progress on a proposed financial technology center at the former UConn campus in West Hartford came to a halt after the CEO of Ideanomics suspended work at the site citing “regrettable and unreconcilable differences with the State of Connecticut.” After a meeting with Lamont last week, CEO Alfred Poor said a “solution has been reached to move forward” on what his company is calling Fintech Village. Ideanomics purchased the West Hartford site in 2018 for $5.2 million and has planned a $283 million financial technology hub slated to bring 330 jobs to the area. The project received a $10 million loan from the state. As part of the deal to purchase the property, Ideanomics agreed to remediate the campus before developing it.

Odds and ends

The state budget bill has been public for two weeks but interesting tidbits tucked within the 567-page document are still being discovered. The Courant’s Jon Lender reported last week that the bill contains highly technical language that in effect gives legislative employees (not including lawmakers) 7 percent raises over the next two years. Like some of the other items tucked in the budget during the final days of deliberations, there was no public discussion of the issue. ... Consumer Counsel Elin Swanson Katz is departing her role as the state’s top consumer advocate, Lamont announced Friday. Katz has held the job since 2011. Before that she was a lawyer at firms in Washington, Boston and Hartford and assistant counsel at the state Department of Environmental Protection. Lamont didn’t say what Katz was doing next, just that she’d be leaving July 5 “to pursue her passion for improving broadband access for Connecticut’s citizens.” The Connecticut Mirror reported Katz was taking a legal and executive position with Tilson Technology Management, a Portland, Maine-based information technology company opening an office in Connecticut. ... Greenwich native Hope Hicks has agreed to testify before the House Judiciary Committee as Democrats continue their investigation into whether or not the Trump campaign colluded with Russian agents meddling in the 2016 presidential election. Hicks, a former Ralph Lauren model who was Trump’s press secretary during the campaign and took a White House job after he won, now holds a communications job with the Fox Corporation in Los Angeles. ... Vice President Joe Biden has said his presidential campaign won’t accept lobbyist contributions, but that didn’t stop lobbyists including former U.S. Sen. Chris Dodd, D-Conn., from showing up at a Washington fundraiser Monday evening, according to an account in Politico. Dodd, a registered lobbyist who was previously head of the Motion Picture Association of America, is now senior counsel with Arnold & Porter Kaye Scholer, a white-shoe law firm based in Washington. The next night, Dodd joined House Speaker Nancy Pelosi at a fundraiser for U.S. Rep. John Larson, D-1st District, according to Politico. Pelosi will be in Larson’s district Friday evening (June 21) to speak to Connecticut Democrats at their annual fundraising dinner. Also attending Larson’s fundraiser were his Connecticut colleagues Joe Courtney, D-2nd District, and Jim Himes, D-4th District. ... Vineyard Vines is OK but the town of Greenwich is telling municipal employees they can’t wear flip-flops to work. That includes school district employees. Lifeguards, swim instructors and staff at town-run camps are exempt from the new rule. Town leaders said it’s about safety, not fashion. “One of the things that this is trying to do is prevent slips and falls or trips and falls,” Mary Pepe, town director of human services, told the Greenwich Time. “Stopping those from happening is a great way to avoid workplace accidents or sprained or twisted ankles and other injuries.” Speaking of Greenwich, veteran Connecticut political reporter Neil Vigdor, who started a new gig at The New York Times last week, has his first byline: an explanation of the Hatch Act, the 1939 law prohibiting executive branch employees from engaging in some forms of political activity. Trump adviser Kellyanne Conway is accused of violating the Hatch Act and a federal agency has recommended she be removed from her White House job.

Russell Blair can be reached at rblair@courant.com.

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