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September 26, 2022

Lamont, Stefanowski diverge on outlook for CT businesses

Contributed Gov. Ned Lamont answers questions from Chris DiPentima, president of the Connecticut Business and Industry Association, at an association-sponsored event on Sept. 23.

Gov. Ned Lamont and gubernatorial challenger Bob Stefanowski addressed the Connecticut Business and Industry Association Friday, with Lamont emphasizing investments in the workforce, small businesses and government efficiency over the last few years and Stefanowski focused on trimming government and cutting taxes.

The Democratic and Republican candidates, both businessmen, shared a common understanding of many of the challenges the business community faces. But their outlooks diverged.

Stefanowski started out by citing CNBC’s “Top States for Business” ranking, in which Connecticut placed 39th and was graded “F” for affordability.

“I think it’s horrible what’s happened to small and mid-sized businesses in Connecticut,” Stefanowski said. “If you had a CEO that had the performance of the last four years in Connecticut, would you hire him for your company?”

Lamont, on the other hand, was characteristically upbeat.

“We’ve had four balanced budgets in a row, and I think that speaks volumes about where this state is going,” Lamont said. He pointed out that Connecticut has a budget surplus this year and a healthy rainy day fund.

But Lamont went on to say that with the threat of a recession not too far off, he wants to remain cautious about spending. “I’m trying to give you stability,” he said.

The candidates were interviewed on stage at the Downtown Marriott in Hartford, before a room of nearly 300 attendees from the business community. In separate question-and-answer segments, CBIA President Chris DiPentima asked Stefanowski and Lamont to respond to the association’s policy plan, dubbed “Transform CT.”

CBIA’s plan asks lawmakers to “pledge” to make Connecticut more affordable by incentivizing the development of “workforce housing,” helping companies offer student loan assistance to their employees, and bringing down the cost of health insurance. The plan calls for several tax breaks for businesses, including those that would support research and development and worker training programs. CBIA also laid out changes to occupational licensing and immigrant visa programs aimed at bringing more skilled workers into the state.

According to a survey of CBIA members, 85% of employers are having a hard time finding and retaining employees. Nearly 90% expect the cost of running a business in Connecticut to get worse. Still, 65% said they expect 2022 to be a profitable year.

The candidates agreed that workforce development, like technical training and skills certifications and apprenticeships, were a top priority.

“These kids coming out of trade schools have three, four job offers — electricians, people with construction skills,” Stefanowski said. “Why aren’t we investing more in our trade schools? They’re all at capacity. Why don’t we open up five more?”

Lamont pointed to the work of the Governor’s Workforce Council and touted the amount of funding those initiatives will receive — much of which comes from federal COVID relief legislation. “We’ve got the biggest investment in workforce development in the history of the state, well over $100 million slated this year and next year,” he said.

Lamont added that additional funding for child care, which he signed into law this year, will support more parents returning to the workforce.

The candidates agreed that in order to attract labor and keep those people around, Connecticut needs to build more housing.

“Right next to workforce is housing,” Lamont said. He added that “things are picking up,” with multifamily housing construction on the rise.

In many Connecticut towns, residents are resistant to new construction, which has contributed to the statewide lack of affordable homes and apartments. Stefanowski said he wants to repeal the state’s current affordable housing legislation and take a more individualized approach with each community.

“We need to work with the towns, we need to hold them accountable, but it’s about working together,” Stefanowski said. “We’re gonna use the carrot, not the stick.”

For the business community, reducing their tax burden is always a top priority, and DiPentima asked both candidates to weigh in on the association’s proposed tax reforms.

Stefanowski said he wants to extend the fuel tax holiday, reduce sales taxes, expand property tax relief and simplify the state’s tax code. He said there are hundreds of small taxes and fees the state collects that don’t contribute much to the bottom line but add complications for businesses.

“On day one, I’m going to stop collecting the bottom 200,” he said.

Lamont said he was supportive of some of the business tax credits CBIA proposed. “Makes pretty good sense to me, I’d have to look at it,” he said when asked about eliminating sales tax on training paid for by employers.

Broadly, Stefanowski’s economic plan would reduce taxes in an effort to stoke economic activity.

“We have to stimulate this economy,” he said. “I don’t care who takes credit for it, but we’ve got $6 billion of surplus. Why wouldn’t you use some of that money to stimulate the economy?”

Lamont defended his “conservative” stance on protecting those surplus dollars. “I have to be the guy to make some choices,” he said. “And if I collect revenues here or increase spending over there, what am I not doing? I’m not paying down our state pension liabilities.”

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