Connecticut Lawmakers Reach Preliminary Budget Deal

Connecticut's monthslong budget impasse may be coming to an end.

Democratic and Republican leaders in the state legislature said Wednesday they reached a preliminary budget deal and intend to vote on it next week. The state hasn't had a budget since the fiscal year ended in June as lawmakers failed to reach a solution to close the state's two-year, $3.5 billion deficit.

"We have a tentative agreement on major issues," said Republican House Minority Leader Themis Klarides. "There will be people who hate this, there will be people who love this."

The bipartisan group of lawmakers have been working for weeks on crafting a new agreement after Gov. Dannel Malloy, a Democrat, vetoed a budget passed in September. The legislative leaders said they intend to seek enough support from rank-and-file members to produce a veto-proof majority should the governor seek to veto this budget as well.

Mr. Malloy said he would withhold judgment on the plan until he can review all of the details. Legislative leaders said they hoped the governor could be persuaded to support this agreement.

"I don't think it serves the state well to go through a whole veto process and override," said Speaker of the House Joe Aresimowicz, a Democrat. "Let's all agree that the public wants a bipartisan agreement signed off by the governor to move the state forward."

This new agreement doesn't include a controversial proposal from Mr. Malloy that would have shifted about $282 million in teacher pension costs from the state to municipalities over the next two years. The governor said the state eventually would be unable to cover those costs. City and town officials across Connecticut were widely opposed to the change.

Mr. Malloy said the absence of that proposal wouldn't necessarily prompt him to veto the budget.

"I don't think there is any one thing that would cause me to veto a budget," Mr. Malloy said. "But there is probably an accumulation of things that, if I find those, would be difficult for me to sign."

Republicans backed off their demands for changes to the pensions of teachers and state employees. Mr. Malloy has said those proposals are likely illegal and would have been challenged in court by public-sector unions.

The new agreement also would give additional aid to Hartford. Officials in the capital city have said it could file for bankruptcy as early as next month if the state doesn't help out.

"The city of Hartford will be on a brighter path once we get this budget passed," said House Majority Leader Matt Ritter, a Democrat.

Write to Joseph De Avila at joseph.deavila@wsj.com

(END) Dow Jones Newswires

October 18, 2017 18:05 ET (22:05 GMT)