Archive for the ‘State Budget’ Category

2Norwalk housing project gets millions from taxpayers while Boston-based developer gives to Dems

Connecticut’s oldest public-housing project, Washington Village in Norwalk, has received tens of millions in taxpayer money recently, including $30 million in federal funding this week, while a top leader of the developer in charge of the $110 million project has been contributing regularly to the Connecticut Democratic Party.

Sens. Richard Blumenthal and Chris Murphy along with Rep. Jim Himes, who represents Norwalk, celebrated the grant from the Department of Housing and Urban Development Monday.

The funding is part of HUD’s Choice Neighborhoods Initiative, which hopes to convert affordable housing into mixed-income housing.

On Tuesday, Gov. Dannel Malloy and state Housing Commissioner Evonne Klein announced $9.8 million in additional federal funding passed through Connecticut’s new Department of Housing. HUD awarded Connecticut a total of $31 million for disaster recovery from Superstorm Sandy.

Previously, Washington Village received a $1.89 million low-income housing tax credit.

Boston-based Trinity Financial will redevelop Washington Village with the Norwalk Housing Authority and the Norwalk Redevelopment Agency.

Patrick Lee, a co-founder and executive vice president of the company, donated $7,500 to the Connecticut Democratic Party in the past year.

In 2013, Lee donated $2,500 on July 18 and again on Aug. 1.

HUD announced the availability of Choice Neighborhoods funding on June 13, 2013, and the deadline for applications was Aug. 12.

Malloy first announced the $9.8 million in disaster funding on April 11.

Lee donated another $2,500 on April 23. He made all of his donations to the party’s federal account. As a top executive at a company that receives state assistance, Lee would be ineligible to give to the party’s state account.

In November 2013, the party received thousands in donations from others with affordable-housing business, also through its federal account.

0State awards another $10 million in stem-cell grants to the usual suspects

The state awarded another $10 million in stem-cell research grants Tuesday, but not a single private company benefited.

Like the $80 million awarded in the previous seven years, most of the money this year went to the University of Connecticut Health Center or Yale University.

The Jackson Laboratory for Genomic Medicine, already the recipient of $291 million in taxpayer largess, secured $1.1 million from this batch of stem-cell research funding.

In the history taxpayer funding of stem-cell research in Connecticut, only two private companies received grants totaling $2.4 million out of about $90 million, or less than 3 percent.

2IT audit reveals state may owe $5.2 million for 4,500 non-compliant software licenses

A review by an unnamed software company found 4,500 improper licenses on state computers, according to the Auditors of Public Accounts, a failure that could cost more than $5.2 million.

Auditors, reporting on the state’s former information technology agency now spread across multiple state agencies, suggested the development of a process for disposing of computers and software products. When state agency’s questioned the value of developing the policy considering its costs, the auditors pointed out the manufacturer’s review.

“This is an example of just one software compliance audit,” the auditors wrote. “It would appear, based on potential, future compliance audits and penalties that the benefits of a central software acquisition, management, use, deployment and disposal platform and policy would far outweigh the costs of development and implementation.”

Auditors also found:

– Errors in longevity payments. The agency overpaid at least three employees and underpaid one by more than $12,000 over a number of years.

– Improperly reported cases of misused state resources. One employee had to pay back the state for using a state cell phone for personal calls while another received a 30-day suspension for viewing pornography on state computers, but the agency didn’t report either case to auditors or the comptroller, as required by law.

0Agreement with parole officers restores nearly three years of expired time off

The Department of Correction agreed last year to restore nearly three years of expired time off for 40 parole officers, an average of 3.5 weeks each.

In 2011, auditors discovered an accounting glitch that allowed a small group of state employees to build up thousands of hours of extra time off. At least 40 parole officers kept compensatory time that should have expired.

The department fixed the error and time off started expiring for the parole officers. Their union negotiated the 2013 agreement to restore 5,800 of properly expired leave.

According to a list attached to the agreement, the Department of Correction reinstated time off ranging from half an hour for one parole officer to 688 hours – more than 17 weeks – for another.

In all, Connecticut owes its employees about $676 million for paid time off, down slightly from fiscal year 2012 when the value exceeded $700 million.

DOC had the parole officers in the wrong category. After auditors found the problem, DOC put the employees into the correct leave plan and opened negotiations with the union to determine how to handle the improperly-earned time off.

The department signed a March 2013 agreement with AFSCME Council 4 to resolve the issue by reinstating time off that expired between October 2012 and January 2013, which amounted to 147 weeks or nearly three years. The parole officers have three years to use the time off granted under the agreement.

DOC spokeswoman Karen Martucci said the agreement with the union set out to “address a discrepancy identified through an audit of the agency’s financial records.”

“Specifically, parole officers were entered into the payroll computer system coded into an incorrect leave plan, which wasn’t consistent with the compensatory time expiration language applicable to that job classification,” Martucci said. “The DOC and the union were in agreement to meet and discuss a fair resolution to the issue, which ultimately resulted in this signed contract.”

0Correctional supervisors at top of pay scale get ‘lump sum payments’

Connecticut’s longevity pay for state employees – $13.8 million in April – is no secret, but a small group of state employees also get “lump sum payments” equal to 2.5 percent of pay.

While longevity payments go to union state employees based on the length of their careers, lump sum payments go to about 100 correctional supervisors who have reached the peak of the pay scale.

The state makes the payments whenever the supervisors, members of the SEIU Local 2001 NP-8 bargaining unit, would otherwise be eligible for an annual increment in their pay.

Due to the payment code used to process the lump sum payments, it is not possible to precisely identify the total cost. However, all payments in the category – which includes certain other payments, too – to eligible employees add up to $184,058.

Two years ago, the legislature ended longevity pay for non-union state employees only to give them a raise of the same amount.

0With fewer served, costs rise at state-run homes for developmentally disabled

Fewer people with developmental disabilities in Connecticut need the highest level of care, but rising costs are growing the gap between high-cost treatment in state-run facilities and lower-cost private alternatives.

According to 2013 data provided by the Department of Developmental Services, the number of people in federally-designated intermediate care facilities for individuals with intellectual disabilities fell below 1,000 last year. The federal government reimburses half the cost of care at these facilities.

The cost of care is growing rapidly at state-run facilities. At the highest-cost regional centers, run by DDS, the average cost per person rose 10.5 percent in a year, from just over $400,000 to a little more than $442,000.

Costs at Southbury Training School, slightly lower-cost but still state-run, increased by more than 8 percent and now exceed $350,000 per person.

Private-run ICF-IIDs saw costs rise by a more modest 3 percent, nearing $165,000 or less than half cost of the state-run programs.

With more than 600 people seeking residential services from DDS as of December, private facilities offer the possibility of helping more people without increasing costs.

A DDS spokeswoman attributed the rising costs to “the drop in consumer counts.”

Recently, DDS has come under scrutiny for the death of a Southbury Training School resident and falling behind on its abuse registry.

0Suffield to claim bond funds 14 years later

After leaving a state grant unused for 14 years, Suffield is finally claiming $75,000 in borrowed funds, although for a new project.

Originally intended for “renovations and improvements to an existing bathhouse at Babb’s Beach,” the town never completed the project. The State Bond Commission will vote today on repurposing the money for improvements to the skating rink building on the same property.

4NBC Sports gets more taxpayer money after exec appears in state ads

NBC Sports is set to receive another $6 million in taxpayer funds – beyond the $20 million the company already received – in return for creating 150 new full-time jobs within five years.

The State Bond Commission will consider the funding proposal from the Department of Economic and Community Development Friday. The $6 million loan is forgivable, with payments deferred for five years and a 1 percent interest rate.

The subsidy amounts to $40,000 per job created. The first $20 million loan supported the creation of 450 jobs.

Earlier this month, an NBC Sports executive appeared in a state-funded economic development ad.

“We consolidated our operations right here,” Princell Hair, senior vice president of NBC Sports Group, says in the commercial.

“For the last several years, we have worked to create a business climate in this state that grows jobs,” Gov. Dannel Malloy said when he announced the ad campaign. “And everywhere from small businesses on Main Street to major companies, we are seeing results. This new phase of our effort to encourage economic growth makes it clear that Connecticut can be a destination for and home to innovative companies.”

Danbury Mayor Mark Boughton, a Republican candidate for governor, criticized the ads as “purely political.”

Employees of NBC Universal and NBC Sports contributed $4,600 to the Connecticut Democratic Party’s federal account in January. State contractors and recipients of state aid can donate to political parties through their federal accounts, despite the ban on direct contributions to candidates.

The owner of the property occupied by NBC Sports gave the party $2,500 in November.

0UTC extra-credit deal equivalent to reducing corporate tax rate from 7.5 to 7.25 percent

The $400 million deal between Gov. Dannel Malloy and United Technologies Corp. will reduce state revenues over the next 15 years by at least as much as a quarter-point reduction in the corporate tax rate.

The deal allows UTC to use otherwise unusable tax credits in return for a making capital investments in Connecticut.

In 2016, the first year of the UTC deal, state officials expect the corporate tax to bring in $631.2 million. Under current law, the corporate tax rate in 2016 will be 7.5 percent after the expiration of a surcharge bringing the rate to 9 percent.

The $20 million in potential extra credit for UTC amounts to 3.1 percent of corporate tax revenue.

If the General Assembly had instead reduced the corporate tax rate by 3.1 percent it would fall from 7.5 percent to 7.27 percent. For the first five years of the deal, with the extra credit capped at $20 million per year, the effect of the deal hovers between a 7.25 and 7.3 tax rate.

After the initial five years, the cap increases to $33.3 million annually, and the effective tax rate falls below 7.25.

These projects assume no dynamic effects of reducing the corporate tax. A reduction in the corporate tax rate could increase corporate taxes and revenue from other sources, mitigating the projected loss of revenue.

2Connecticut insurance exchange hired marketing company for ‘legislative communications strategy’

Access Health CT, the health-insurance exchange implementing Obamacare in Connecticut, paid a marketing firm millions in part to “engage key legislators” but contends the agreement does not violate a ban on lobbying by quasi-public state agencies.

The original $7.2 million agreement with marketing consultant Pappas MacDonnell included $59,900 for a “legislative communications strategy.”

“The quick answer is, NO they do NOT do any lobbing for us, they are a Marketing Firm only,” said Kathleen Tallarita, spokeswoman for Access Health and a former state representative.

State agencies, including quasi-publics, are not allowed to hire lobbyists.

The agreement describes the goal of legislative communications:

“To establish Access Health CT as the marketplace for quality, affordable health insurance in Connecticut, Pappas MacDonnell will immediately engage key legislators to ensure that they understand what Access Health CT is, how it functions, its impact on Connecticut’s health insurance marketplace, and the potential implications of legislative action (or inaction) in the upcoming sessions.”

Connecticut law defines lobbying, with a few exceptions, as:

“communicating directly or soliciting others to communicate with any official or his staff in the legislative or executive branch of government or in a quasi-public agency, for the purpose of influencing any legislative or administrative action.”

Pappas designated its subcontractor, public affairs and lobbying firm Grossman Heinz, to work on the legislative strategy listing three individuals – all billing $300 an hour – Andrew Grossman, Chris Heinz and Lynn Pincus.

The agreement lists “legislation” in a description of the duties of two project managers: Logan Kelly ($75 per hour) and Quynh Tran ($60 per hour).

“As a secondary objective Pappas MacDonnell will also seek out legislators’ input on consumer outreach and Navigator programs to get their buy-in to aid in the coordinated consumer outreach process,” the agreement says.

Access Health agreed to pay Pappas another $10.3 million under an October 2013 addendum that does not mention legislative communications for a total payment of $17.5 million. According to Tallarita, the payments to Pappas include the cost of advertisements purchased by the firm on behalf of Access Health.

Separately, Access Health hired Global Strategy Group to handle public relations.

The Connecticut Health Investigative Team reported earlier this year that Access Health, considered one of the more successful state-based exchanges, spent $156.3 million to start up.

Access Health also paid Pappas $1,650 each for two “CEO messages.” The contract originally called for 15 such messages – totaling $24,750 – but Tallarita said the exchange only sent out two.

Access Health also paid three artists $24,980 each to paint murals.