A bipartisan group of state lawmakers endorsed requires increasing small enterprise help amid the rising labor scarcity and a fragile financial restoration.
Speaking at CBIA’s Jan. 21 Economic Summit + Outlook, the group additionally largely endorsed calls to make use of extra federal COVID-19 aid funds to assist repay the state’s $520 billion-plus unemployment fund debt.
“Our small business owners are the crux, the foundation of our state and they provide the vast majority of jobs in our state,” mentioned Rep. Terrie Wood (R-Darien).
“We need to provide all the support we can for businesses, who are providing jobs, and without jobs, we don’t have people living here.”
Wood, Sen. Paul Formica (R-Niantic), Sen. Norm Needleman (D-Essex), and Rep. Kerry Wood (D-Rocky Hill) previewed the 2022 General Assembly session with CBIA’s Eric Gjede.
All 4 legislators help CBIA’s Rebuilding Connecticut pledge, developed as a coverage roadmap for serving to employers, significantly small companies, navigate the pandemic and drive job and financial development.
“Apprenticeship programs, job creation programs, and overall business climate issues should be a priority this session,” Formica mentioned.
‘Shift the Narrative’
Formica famous that whereas giant firms “are the baseload group that propels our economy, small businesses are over 90% of the job creators in this state.”
“Slow job growth is a big deal in Connecticut,” he mentioned. “Small businesses face huge difficulties finding workers.”
Formica and Needleman mentioned data know-how job coaching applications and fewer crimson tape have been important for filling the state’s estimated 70,000 job openings.
Needleman referred to as for “a shift in the narrative” to help the expert trades and the careers they create.
“My focus has been on making sure we don’t leave people behind and make sure we have a workforce that is working and trained properly for the jobs that exist now,” he added.
Supporting job coaching applications inside the state’s neighborhood faculty applications is a technique Terrie Wood believes will tackle the challenges.
“They’re so good, they’re fast, they’re accountable, they’re transparent, they offer a terrific education,” mentioned Terrie Wood.
Kerry Wood added that preserving current faculty graduates in Connecticut was difficult, given the state’s affordability points.
“Things we can do here is provide student loan help, especially for those skilled workers that we desperately need,” she mentioned.
Tax Relief
Gjede framed the dialogue with legislators round CBIA’s 2022 coverage priorities, which have been launched the identical day as the convention and deal with addressing the labor scarcity and tax aid.
Connecticut is projected to have a $2.2 billion funds surplus this fiscal 12 months, and $1.9 billion the following 12 months, making its near-term fiscal well being one in every of the strongest in the nation.
“The state’s current fiscal picture provides a platform to do much more than hold the line on taxes and pay down long term liabilities,” CBIA president and CEO Chris DiPentima mentioned earlier at the convention.
Gjede referenced the 2017 bipartisan funds reforms “that certainly helped put us in a strong fiscal position coming out of the pandemic.”
CBIA is looking for about $200 million in tax aid, largely focused at small companies and designed to handle the labor scarcity, which impacts 80% of the state’s employers, and stimulate non-public sector funding.
The panel of lawmakers typically agreed that tax aid was a well timed situation, sharing completely different concepts for tackling the situation.
‘Long Overdue’
“I think there is a lot we can do in small steps this session, but I would also like to see some long term strategies put in place so that future sessions can continue the work we do this session,” mentioned Kerry Wood.
The Rocky Hill Democrat mentioned she helps increasing the state’s manufacturing apprenticeship tax credit score to small and midsized producers, altering the state’s property tax construction, and offering aid for retired residents.
“Tax relief is long overdue,” mentioned Terrie Wood. “We can’t count on federal funding for the long term. We should absolutely be looking at cutting taxes.”
“We should absolutely be looking at cutting taxes.”
State Rep. Terrie Wood
“It’s always time to provide tax relief for taxpayers in Connecticut, whether they’re businesses or residents,” he mentioned. “We have to be able to find ways to efficiently fund government, both on the local and state level.”
Needleman referred to as addressing the tax code “a very long walk into the woods,” including he believes it is going to be troublesome to implement any kind of tax aid on this 12 months’s quick legislative session.
“Everybody on this panel would agree that the tax code is not the most equitable or productive in a lot of ways,” he mentioned.
“I also believe fundamentally that one-time revenue should never be used to build permanent spending or permanent tax cuts because two-three years down the road we could be back in the soup.”
Unemployment Debt
Last 12 months, the Lamont administration and the legislature agreed to make use of $155 million in federal COVID aid funding to assist repay the roughly $1 billion the state borrowed from the federal authorities to pay report unemployment claims.
CBIA is recommending the state leverage extra federal aid {dollars} to keep away from tax hikes and assessments on employers at a crtical level in the Connecticut’s pandemic restoration.
Gjede mentioned Connecticut “cannot afford to repeat the aftermath of the 2008-2010 recession, when employers were hit with unemployment tax hikes four times higher than in neighboring states.”
Rep. Kerry Wood says she helps placing extra money into the unemployment fund “to help businesses over the long term.”
“First of all, that number [$155 million] was much lower than the business community was asking for,” mentioned Kerry Wood.
“This is part of what these dollars are there for and I do support putting more money into this fund so that we can help the business community over the long term. Ultimately this falls on their shoulders.”
Terrie Wood referred to as the situation crucial, noting the impression that unemployment tax hikes and and assessments may have, “particularly on small businesses.”
“The more we can pay that down and reduce the burden on businesses, the better off we are going to be,” she mentioned.
Small Business Support
Needleman, who owns manufacturing firm Tower Laboratories, mentioned “speaking out of self-interest, as a business with a very large payroll, of course I would like that.”
“As with everything else, the state government and municipal governments find themselves dancing on the head of a pin—there’s going to be a lot of demand on a small amount of money,” he mentioned.
Needleman mentioned he most popular to see the U.S. Congress take motion and “hold all state unemployment funds harmless because it’s such a big problem across the country and in Connecticut.”
“We have to do whatever we can to help small businesses.”
State Sen. Paul Formica
“That said, I would like to see us use some of that [federal funds],” he mentioned.
“I remember having to pay that large assessment some years ago,” mentioned Formica, who owns Flanders Fish Market & Restaurant in East Lyme.
“We have to do whatever we can to help small businesses. This will come out as an important thing to continue.”
Taxpayer Savings
Gjede additionally requested the 4 legislators about the CREATES Report—commissioned by the Lamont administration to handle authorities effectivity and the pending surge in state worker retirements—that recommends $600 million to $900 million in annual taxpayer financial savings.
“I think there were a lot of good recommendations in that report and some of them should be enacted,” Needleman responded.
“I know of no agency that isn’t terrified about the loss of institutional knowledge. We have to be very careful about replacing knowledge and people with technology and untrained or newly trained people—that all the time creates some threat.
“There were a lot of good recommendations in the CREATES Report.”
State Sen. Norm Needleman
“There’s savings to be had. I believe that money invested in technology should have an added and exponential rate of return.”
Formica mentioned he helps suggestions for extra public-private partnerships, increasing the use of nonprofit organizations, and “modernizing and streamlining state government services.”
“We also have to be mindful of those jobs that cannot be replaced by technology,” he mentioned. “They may be able to be enhanced, but they can’t be replaced.”
Streamlining Services
Kerry Wood, who co-chairs the legislature’s Insurance and Real Estate Committee, famous the report’s suggestions as they associated to state-run healthcare plans for public sector workers.
“I love the idea of letting taxpayers know that we’re good stewards of their dollars by making sure the state employee healthcare system is being operated in the most efficient way possible,” she mentioned.
“There is a huge opportunity to streamline state government services,” she added, citing the current overhaul of Department of Motor Vehicles operations for example.
Terrie Wood mentioned there have been a variety of suggestions in the CREATES Report that must be pursued.
“There is a huge opportunity to streamline state government services.”
Rep. Kerry Wood
“Really, the key word for me is simplify, simplify,” she mentioned. “We can reduce some of the redundancies in state government and streamline and simplify.”
She added that she supported reforming the state’s “complicated” hiring practices, implementing a typical fee system, and increasing the use of nonprofit organizations.
“A lot of our nonprofits are capable of delivering the same services at a lower cost and higher quality,” she mentioned.
“They’re close to the people, they’re close to the communities, they know how to best deliver these services.”