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[Stock Lobster]

RJ: Connecticut #1 State Losing Residents

By Mary Ellen Godin
Record-Journal staff
Jan. 24, 2010:

After nine years in retirement, James and Anne Marie Thadieo saw they were spending more and enjoying it less.

So they shopped around and found a smaller home in North Carolina, where they say the taxes are lower and they don’t need winter coats. They sold their house on Catherine Drive and moved in October.

“We love it here,” James Thadieo said. “I live on a fixed income and I gotta go where my dollar can get the best value. I sold my house and bought another one and we’re mortgage free.”

It’s not just the snowbirds who are heading to warmer climes; its families and job seekers, and many are staying for good.

Connecticut has seen a steady outbound migration for several years, especially among 18- to 34-year-olds. But the exodus continued to add all ages, including retirees, at the start of the recession two years ago.

“They are trying to go somewhere where there are job opportunities, the states with the best employment,” said Janice Warro, office manager for Little John’s Moving & Storage in Meriden.

A recently released study by Atlas Van Lines on 2009 migration trends reports that Connecticut had the highest percentage of moves out of state. Out of 2,031 shipments related to the state last year, 1,230 were outbound, or 60.5 percent, with the 801 inbound shipments comprising 39 percent.

New Jersey and South Dakota followed Connecticut in the percentage of people leaving home. The state continued a nine-year pattern of being classified as an outbound state, which means that more than 55 percent of shipments moved out.

The report shows that people are leaving Connecticut and the Rust Belt states and moving to the Southwest pocket — with Texas, New Mexico and, for the first time in five years, Oklahoma receiving more than 55 percent of shipments related to their states. Other growth areas are in Washington, D.C. — with the highest percentage of inbound traffic — and Maryland, which made the list for the first time since the company created it in 1993. North Carolina has been an inbound state for the past six consecutive years.

But according to Kerri Hart, spokeswoman for Atlas, the survey doesn’t always reflect economic patterns. For instance, both North and South Dakota were outbound states and their employment numbers are high.

Bargains in distressed housing markets such as Florida and Las Vegas could be driving retirees into those areas. A $350,000 home in Florida two years ago can now be bought for about $180,000, agents said.

But local real estate agents said the Carolinas have surpassed Florida as a retirement destination and for job opportunities, although those have slowed with the recession.

“They’re called half-backs,” said Sandy Maier Schede, an agent with Maier Real Estate, about people who move to the Carolinas instead of Florida. “It’s warm half of the time there.”

The Las Vegas area has also become a hot spot for bargain-hunting retirees, but not so much for people in the job market.

Household moves cooled industry-wide in 2009, according to the Atlas study. The company reported a 16 percent drop from 2008, but the summer months were higher than average.

Not surprisingly, Rust Belt states follow closely behind Connecticut. Michigan is number four for most outbound moves, with Ohio and Indiana and Missouri also considered outbound states, and Illinois shifted into the outbound column this year.

Western states such as California, Nevada and Oregon, which have suffered job losses in construction, manufacturing and tourism, have also become less popular destinations.

But the first-time homebuyer’s tax credit helped move housing inventory at all levels.

Joseph Criscuolo, a broker for The Home Store Real Estate in Wallingford, said he’s had one of his best years ever. Out of 54 transactions, three or four were out of state, including the Thadieos. The rest were moves in different areas within the state, he said.

Peter Gioia, a vice president for the Connecticut Business & Industry Association, said the employment and housing problems in Florida and California have helped slow some of Connecticut’s outward migration of young people, although as the stock market rebounds more retirees will feel more comfortable leaving.

The job market in the Texas, Oklahoma and New Mexico market is brighter because of its strong export-based economy with Latin America, the petroleum industry and military-industrial operations.

William Villano, executive director of Workforce Alliance, the private firm that contracts with the state Department of Labor for job development in New Haven and Middlesex counties, said the contrast with the state is significant. Connecticut has lost around 90,000 jobs since the start of the recession. And although the numbers have leveled off, hiring has not picked up in any significant way. Manufacturing has shifted to southern states and offshore. Union construction jobs are also feeling the pinch.

“On some levels, it’s not surprising,” Villano said about the state’s ranking. “If you’re laid off...or if you’re going to take a pay cut, it makes sense to do it where it costs less to live.”

But the state’s unemployment rate of 8.9 percent continues to lag the national rate of 10 percent, and the number of initial unemployment claims decreased by more than 200 from November to December — a 10 percent decline over last year, according to statistics from the state DOL. However, only two major sectors have shown growth over the past year — health and education.

Opportunities for young people may not be as strong in California or Florida in the past two years, but other cities in the country are doing more to attract young talent.

Affordable housing and cultural activities are driving young people to cities such as Austin, Texas. AT&T has invested millions to build and equip a technology center at the University of Texas there and maintains a strong partnership with the school.

The company has added hundreds of jobs in Austin, Oklahoma and Nevada. In the past decade AT&T cut about 1,000 well-paying jobs in its landline customer service and repair sectors in Connecticut, but added more openings in the state for its broadband Internet and wireless products.

Pratt & Whitney is in a legal battle to eliminate 1,000 high-paying jobs in its jet engine repair divisions in Cheshire and East Hartford. If it wins, the work will shift to Georgia and Singapore.

“The availability of quality jobs has been diminishing,” Villano said. “There are some opportunities for people who have significant skills and talent. The problems with the types of jobs we’re growing (is that they) are lower-end jobs.”

Paul Ott is a veteran real estate agent with William Raveis Real Estate in Cheshire. He’s now working with three clients in foreclosure who have moved to Texas, Florida and North Carolina, respectively, in the hopes of finding jobs or to be with family. In the case of one client who walked away from his home on Paddock Avenue in Meriden, it was for warmth.

The client, who did not want to be interviewed for this story, was laid off by Atlas Container last summer, Ott said. (The company is not related to Atlas Van Lines). He collected unemployment but fell behind in his payments and owed more than the home was worth.

“He said ‘It’s better to be homeless in a warmer climate,’” Ott recalled. “That’s scary stuff. The jobs are not here to keep them here.”

Kathleen Quinn, operations director for the CT Works career centers, said the agency and the state labor department are working overtime to keep up with the need for services for the unemployed and underemployed.

“The first thing that comes to my mind is they have exceeded their benefits,” Quinn said.

Connecticut has a 21-month time limit for receiving cash assistance, while the federal limit is 60 months. Often, people who have exhausted their 21-months will travel to another state where the limit isn’t as severe and can continue to collect.

“It could be people are exhausting their benefits,” Quinn said.

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Murray
MyRecord-Journal.com New Member Join Date: Oct 2008
Posts: 37

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I am one of those who moved out of CT last year and am now a resident here in the midwest. It is a different way of living out here.....in a very good way.

There are lots of parks so you can get out to enjoy the great outdoors and the clean air. When you drive around, one of the things you notice is that there isn't trash strewn on lawns, streets and on the side of the highways. People are friendly, considerate, welcoming and take pride in their community. Crime is low and respect for the law is high.

The cost of living is much lower. I opened my gas and electric bill for December and was shocked....it was 1/2 of what just my gas bill was with CL&P. At the closing of my brand new condo, I asked what the property taxes were. Almost fell off my chair because back in Meriden they were 8 times higher. Dining venues are full since a couple can have a wonderful dinner out for under $40.00 and finding lunch under $5.00 per person is the rule not the exception.

Close to Chicago and other major cities but if it's too far to drive, we have an international airport 15 minutes from home.

Love of country and pride in the military is high. When you go anywhere be prepared for eye contact, smiles and hellos.

Would I move back to CT? No. When I do start to miss family and friends there is always email, the telephone and a plane to take me back for a visit.....just a visit.

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Bustopher Jones
MyRecord-Journal.com Member Join Date: Aug 2008
Location: Wallingord
Posts: 334

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I love Connecticut. I have lived here all my life, as has my wife. We raised our kids here. I would never consider moving voluntarily. But with that said, I don't know if I am going to be driven out. I am facing retirement on a fixed income that is comprised of little more that my Social Security benefits. With the way that property taxes have been escalating in Wallingford, and taxes and fees growing by leaps and bounds at the State level, I might have no choice someday but to pack my wife and my dog into the truck and head somewhere with a lower cost of living. And when that day comes, I will be heartbroken...

[Stock Lobster]

GT: Greenwich CT resentful of status as state income tax cash cow

By Neil Vigdor, Staff Writer
Published: 02:20 p.m., Saturday, January 30, 2010
Greenwich Times

If Greenwich had a town song, "You Don't Bring Me Flowers" would be in the running.

For every $142 local residents pay out in state income tax, Greenwich gets about $1 back in municipal aid annually, according to a new study by the South Western Regional Planning Agency that has town officials once again saying that they are stuck in a one-way relationship.

"When the hard-working people of southwestern Connecticut and other pockets of Connecticut end up subsidizing large bureaucracies that do not demonstrate much accountability and tend to grow at unsustainable rates, then you're going to have, at some point, a breakdown in the system," said state Sen. L. Scott Frantz, R-36th District, which includes Greenwich and parts of Stamford and New Canaan.

"As tax rates go up to the point where people realize that they are paying much more than their fair share, they tend to leave the state."

Greenwich provided the state with $758 million, or just over 14 percent, of its income tax revenue in 2007, the most recent year that figures were available to the eight-municipality planning consortium.

On a per-capita basis, that works out to $12,420 for each of the town's 61,101 residents as estimated by the 2000 Census.

The next closest municipality was Stamford, which accounted for $241 million, or 4.5 percent, in state income tax revenue.

Greenwich received $5.3 million in state statutory grant aid for the fiscal year starting July 1, 2007, and ending June 30, 2008.

Stamford collected $15.7 million in state aid in return for the same period.

Rep. Cameron Staples, D-New Haven, co-chairman of the General Assembly's Finance, Revenue and Bonding Committee, said the system was never intended to provide a return on contribution.

"State aid is not supposed to be, in my view, equitably distributed to towns," Staples said. "State aid for the most part goes for services that the state needs to supplement at the local level. A town like Greenwich has the ability to fund most of its own services. The city of Bridgeport is not capable of fully funding its own education system."

SWRPA shared its analysis of the state income tax this month with chief elected officials in its member cities and towns, including Republican First Selectman Peter Tesei of Greenwich.

"I think it's a validation of what many people have expressed -- that we pay a disproportionate share of the taxes and receive a smaller portion of the revenue," Tesei said. "Therefore when we get to looking at the state budget situation, given the political composition, we're not adequately represented."

Republicans have been in the minority in the General Assembly since 1997.

Staples was quick to point out that the GOP has held the governor's office since 1994, however.

Perhaps Tesei should have said geographical composition instead.

With the exception of Deputy Senate Majority Leader Andrew McDonald of Stamford, the leadership ranks in legislature and executive branch have recently been dominated by lawmakers from outside Fairfield County.

"I certainly agree that Fairfield County has a lot to gain by being a lot more politically involved in Hartford because they're paying a lot more than their fair share of the bill," said Tom Foley, a Greenwich Republican running for governor.

Foley said the average household pays $8,600 annually in aggregate taxes to Connecticut, making it the worst state in a ranking by the Washington, D.C.-based Tax Foundation.

He added that the average income in the state is $68,000.

"One in eight dollars in the household is going to state government," Foley said. "That's way too high."

Members of Greenwich's political establishment uniformly called on the state to rein in its spending and do more to grow the tax base.

"We're facing, over the next four years, a deficit forecast at $12.5 billion," Frantz said. "We immediately need to shore up our fiscal situation by stopping any unnecessary spending and, for the longer term, we need to adopt a sincere pro-growth approach towards running this state."

Frantz criticized his Democratic colleagues for supporting tax increases.

"To be honest with you, I think the majority party in the General Assembly missed the opportunity of a lifetime by increasing the top marginal tax rate on income and capital gains by 30 percent," Frantz said. "We could have almost overnight expanded our tax base significantly by attracting families, corporations and partnerships to the state of Connecticut from New York and New York City alone."

Staples said changes to the income tax were proposed by Republican Gov. M. Jodi Rell and were still quite competitive compared to the rates in New York and New Jersey.

Calling Frantz's comments "rhetoric," Staples said that Republicans have come up with few proposals for streamlining state government on their own while controlling the governor's office.

Democrats, he said, are doing their part.

"There certainly is an ongoing effort to find economies of scale, encourage regionalization of services and encourage consolidation of state agencies in an effort to streamline the state bureaucracy," Staples said.

-- Staff writer Neil Vigdor can be reached at [e-mail] or at 625-4436.

http://www.greenwichtime.com/local/article/Greenwich-resentful-of-status-as-state-income-tax-343275.php

http://www.stamfordadvocate.com/local/article/Greenwich-resentful-of-status-as-state-income-tax-343275.php

[Stock Lobster]

GT: CT Dems want bonus surcharge, but is it legal?

By Brian Lockhart, Staff Writer
Published: 09:29 p.m., Monday, February 15, 2010

A few days before the start of the 2010 legislative session, Derek Slap, spokesman for state Senate Democrats, circulated to the caucus a $20 million proposal to assist small businesses that would be funded by a two-year surcharge on certain executive bonuses.

Slap wrote in the accompanying e-mail that Senate President Donald Williams, D-Brooklyn, and Majority Leader Martin Looney, D-New Haven, "feel it is important to begin session week with some specific proposals to jump-start job growth."

But two weeks after Williams and Looney announced their jobs agenda, it is uncertain whether they have the legal authority to impose the bonus surcharge, how it would work or even if Democrats have enough votes to pass it.

Hoping to tap into outrage over the latest round of bonuses paid to Connecticut residents employed by banks and insurers that received federal bailouts, Williams and Looney during a Feb. 1 press conference said they wanted to place a 2.47 percent surcharge on bonuses of $1 million or more.

They would apply the surcharge retroactively to bonuses awarded this winter and next year, using the as-yet-unspecified revenues for a small business loan fund.

But some key votes, like Sen. Andrew McDonald, D-Stamford, have questioned the legality of the move.

"I'm very much in favor of creating a revolving loan fund," McDonald said. "I think the notion of a surcharge presents some unique legal issues that are not yet resolved."

Sen. Eileen Daily, D-Westbrook, co-chairman of the Finance, Revenue and Bonding Committee, said Monday "we're quite sure that we can" impose the surcharge.

But a Freedom of Information request submitted by Hearst Newspapers to Senate Democrats did not yield any formal legal documents from staff attorneys authorizing Senate leaders to move forward.

"There's no kind of formal opinion," Slap said. But he said the matter has been thoroughly researched and discussed by counsel.

Based on the FOIed documents, Senate Democrats' staff began discussing the surcharge in earnest on Jan. 27, sharing news reports and blog items about similar debates in Congress and in England and France.

One e-mail refers to a "final outline" for a bonus surcharge proposal that was floated during Connecticut's 2009 legislative session.

Staff also reviewed a 17-page report titled "Retroactive Taxation of Executive Bonuses" issued in March 2009 by the Congressional Research Service.

It appeared the 2010 effort was in jeopardy when, on Jan. 28, Senate Democrats' legal counsel reviewed an item from The Plum Line political blog. The blog reported that Laurence Tribe, a Constitutional law professor at Harvard University and one-time adviser to Barack Obama's presidential campaign, viewed a similar effort in Congress as an illegal "attempt to punish an identifiable set of individuals who are the subject of understandable outrage."

"That's a show stopper," Joel Rudikoff, an attorney for Williams and Looney, wrote in an e-mail. "What a buzz kill."

But just a few minutes later another state Senate Democrat attorney, Natalie Wagner, referred Rudikoff to another The Plum Line post quoting a contrary opinion from Yale Constitutional Professor Jack Balkin.

"While Harvard may be concerned, a Yale law professor seems to think it's okay," she wrote.

Asked to comment on why Senate Democrats chose to side with Balkin, Daily said there "could be 200 (opinions) back and forth.

"There hasn't been a final decision made on implementation," Daily said. "We'll be having public hearings. We'll get more information that way."

In a January 29 e-mail, Wagner wrote that if the question of constitutionality is raised at the Feb. 1 press conference, "a response ... should generally be that this issue has been researched by constitutional scholars, congressional researchers and our staff over the last year and we believe that the proposal we are putting forward meets the Constitutional parameters suggested by those efforts."

Sen. Bob Duff, D-Norwalk, co-chairman of the Legislature's Banks Committee, has other concerns. Duff on Jan. 31 e-mailed Slap wondering how lawmakers would identify bonus recipients for the surcharge.

"As far as I know, bonuses are categorized under `wages and tips' on a W2 form. It is treated as ordinary income," Duff wrote.

Duff said he has not received an answer.

Christopher Uzpen, a tax and estate-planning attorney in Greenwich for Withers Worldwide, said the Legislature may be able to impose an additional withholding requirement on firms with executives living in Connecticut.

"Administratively, while difficult, that's probably how I guess they would do it," Uzpen said. "They impose the withholding obligation on the employer."

Asked if he thought the idea passed constitutional muster, Uzpen said: "My gut reaction is any time you're choosing to go after a particular group it's a little bit questionable ... This is, I'd guess, just political grandstanding on behalf of the Democrats."

Rudikoff identified "an interesting complication" in a Feb. 2 e-mail, noting Bank of America "announced they're going to spread bonuses earned last year over three years, and pay in some cases 95 percent of them in stock and not cash."

Despite state Republican leaders in the General Assembly expressing outrage last year over bonus payments, some GOP lawmakers said they oppose the surcharge.

"Rather than getting serious about cutting out-of-control government spending, the Democrats are trying to be demagogues by attacking Fairfield County residents," said state Sen. Dan Debicella, R-Shelton, who is challenging freshman U.S. Rep. Jim Himes, D-Greenwich. "Raising taxes on financial services professionals will just cause them to move out of state, hurting the middle class who will have to make up the lost taxes." But Daily argues even with the surcharge, Connecticut's tax rates will remain competitive with those of neighboring states.

"There was concern that it would make some people set up shop out of state, so this is being crafted to be not higher than any other state," Daily said.

State Sen. L. Scott Frantz, R-Greenwich, said bonuses are the wrong target.

"They should not be punishing those who are paying the bills for Connecticut residents, no matter how angry they are about the financial market meltdown," Frantz said. "I also think it shows a certain amount of lack of understanding of how this problem was created. There's a lot of blame to be passed around."

Senate Democrats will need to win over their counterparts in the House of Representatives.

Rep. Christopher Perone, D-Norwalk, a Finance Committee vice-chairman who is also helping draft a job creation proposal for his caucus, said, "Even if the surcharge is legal -- I have some qualms about it -- I just think it would be a hard sell down in Fairfield County."

Republican Gov. M. Jodi Rell's office would not comment on the surcharge proposal, but Senate Democrats would likely not have the numbers to override a veto.

All 24 Democrats would have to vote for an override, and Sen. Gayle Slossberg, D-Milford, said while backing aid for small businesses she is against the surcharge.

"To single out particular people for additional taxes based on where they work doesn't necessarily make a lot of sense," Slossberg said. "Everyone is struggling."

Staff writer Brian Lockhart can be reached at [e-mail]

http://www.greenwichtime.com/local/article/Dems-want-bonus-surcharge-but-is-it-legal-366108.php