UNCASVILLE – With just a week left to win over any undecided voters, the three candidates for governor took to the stage for a final debate and to present contrasting views on the state’s economy and how to use the burgeoning rainy day fund.
Touting a list of accomplishments, Gov. Ned Lamont said Connecticut was able to reopen its economy and rebound from COVID more quickly than other states, with tens of thousands of people moving into the state to bolster the revenue of an already-balanced state budget.
“Four years ago, we were looking at a $2 billion budget deficit, as far as the eye can see,” Lamont said. “We got that budget balanced, without any federal dollars. We balanced it again, and then we got hit by COVID. And I want to say, thanks to each and every one of you, Connecticut got through COVID better than just about any other state.”
Bob Stefanowski, his Republican challenger, shot back that Lamont must be “living in a different state” to say the economy in Connecticut is doing well. He said people are “eating through their savings” every month to pay for rising costs of food and energy.
“I know you have to try to justify the economy because it’s your record, but everybody in this audience and everybody watching on TV knows this economy is horrible,” Stefanowski said.
Independent Party candidate Rob Hotaling said that the economy is “okay,” but that the 100,000 unfilled jobs in the state were a serious concern. Hotaling said that while the Federal Reserve controls the monetary policy that can have a major impact on inflation, the state can move to incentivize building more housing to reduce pressure on home prices, and to extend a gas tax holiday.
“We need to have a soft landing, and often we don’t see that, and we end up going into recession,” Hotaling said. “We need to focus, not just on inflationary measures, but on recession.”
In an October poll by CT Examiner/Fabrizio, Lee & Associates of 1,200 likely voters, 24 percent identified inflation as the most important issue in the gubernatorial race, and 14 percent said jobs and the economy would drive their vote next Tuesday.
The debate Tuesday night – sponsored by the Connecticut Conference of Municipalities and WTNH News 8 – highlighted those concerns, with panelists News 8 Morning Anchor Keith Kountz, News 8 Chief Political Correspondent Jodi Latina, and CCM Executive Director and CEO Joe DeLong pressing the candidates on their plans to address people’s concerns about the economy.
Stefanowski branded Lamont as out of touch, sitting on a $3.3 billion rainy day fund that Stefanowski said should largely be returned to Connecticut residents in the form of tax cuts – a proposal that has been central to his campaign this year.
Stefanowski has said the rainy day fund should be considered closer to $6 billion, considering a forecasted $2 billion surplus this year, and that his plan would spend half of it, leaving about $3 billion to manage any future budget woes.
“If we’re sitting on that money, we have too much,” Stefanowski said. “That’s why my plan, Connecticut first, gives some of it back. Let’s get rid of the food tax the Governor slapped onto prepared foods. Let’s help businesses by paying off that unemployment insurance loan that’s being assessed to them.”
While Stefanowski said “it’s pouring” and time to use the rainy day fund, Lamont and Hotaling said it would be rash to spend that money now, given the impact that a recession could have on the state’s finances.
Hotaling, who claimed more financial experience than his two major-party opponents, said the state needs to keep its surplus reserves.
“Historically, the first thing they cut would be existing programs, so by having those reserves, you don’t affect [them],” Hotaling said.
Lamont said that stripping the rainy day fund is something that governors in the past would have done, leaving the state in a precarious financial situation when trouble strikes the budget.
Pushing back on Stefanowski’s charge that the budget was balanced on federal dollars, Lamont said it is balanced by economic growth and new people moving into the state – that includes increases in revenue from taxes on capital gains and bonuses, which Lamont warned will not last forever.
“Unlike Bob and all of my predecessors [who would] spend down the surplus, spend down the rainy day fund and hope for a better day,” Lamont said. “You know what that meant for each and every one of you, that meant you were screwed. That meant we had cuts into state aid, that meant that tax increases were coming. I’m not going to let that happen.”
Asked what they would do to address high energy costs, Hotaling – who said his campaign was focused on issues than ideology – said that Connecticut’s persistently high energy bills stem from being at the “end of the line” for natural gas and hydroelectricity.
Hotaling said Connecticut needs to “eliminate our dependence on fossil fuels” and generate cleaner, more affordable energy in Connecticut – which would lower transmission costs. He emphasized solutions for homeowners, like heat pumps and more efficient furnaces, and investments in micro-grids to make energy supply more resilient.
Lamont plugged the state’s agreement to buy power from the Millstone Nuclear Power Station when Dominon Energy threatened to close the plant in 2019, a decision that has paid off for Connecticut customers who pay far less for that power than they would for the same amount of power generated by natural gas-fired plants.
“You saw what happened in Germany, you saw what happened in California, places where they let nuclear go,” Lamont said. “We doubled down and locked in the price of 5 cents per kilowatt hour.”
Lamont said that deal has made prices more stable than Massachusetts and New Hampshire – where electric rates just jumped 64 percent or doubled to account for spiking natural gas prices. Those spikes have yet to hit Connecticut fully, though Eversource warned electric bills could grow as much as 40 percent this winter, according to a recent report by WTNH.
“We’re going to have a carbon-free grid, and we’re going to have stable energy prices going forward,” Lamont said. “Look, it’s going to be tough with what’s going on in Europe right now, but I think we’re relatively well-positioned to get through this.”
Rather than respond to the question on energy affordability, Stefanowski opted instead to use his time to argue the merits of spending out of the rainy day fund – saying it is “unconscionable” to sit on that money while people are struggling in Connecticut.
Later on, Stefanowski said, “We are actually going to regulate utility companies, how about that?”