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CCEA Outlook - June 2015

Flat Lining: Connecticut's Disappearing Economic Growth

     In early June, the federal Bureau of Economic Analysis (BEA) revised national 2015Q1 GDP estimates, including, unfortunately, strong downward revisions for Connecticut Real Gross State Product(RGSP), wiping out the strong growth reported in CCEA's previous Outlook.
      As the state legislature prepares to vote on its next budget, CCEA is most concerned for a double negative impact to hospitals: increased state taxes with parallel reduction in direct support, with its proportional reduction in mathing federal reimbursements, as well as several other issues.


Featured Reports

Losing Jobs, Losing Income, and Worsening the Deficit?
The Economic Impact of Connecticut’s Hospital Tax & Reimbursement Policies
                June 2015
      The state extended a budget commitment in FY2011, to help offset their tax on hospitals, promising to expand its finanial support, which support was a channel for federal reimbursement.
    However, the state has reduced its support to hospitals, and under the balanced budget constraint, State support fell $26 million in 2014, with projections showing higher short-falls thereafter, $108 million in both 2016 and 2017. Hospitals are therefore foregoning nearly $200 million in federal funds, reducing hospitals' income stream, resulting in lost jobs, lost wages, lost tax revenues to the state, and a reduction in personal income across the state.

Connecticut Green Bank’s Residential Solar Investment Program:
Economic Impact Analysis of Existing Commitments and Future Scenarios
                February 2015
      This CCEA study of the Connecticut Green Bank's Residential Solar Investment Program (RSIP) describes how existing commitments not only resulted in job creation and higher personal income in the State, but also indicate that future plans will likely have an even greater positive impact.

Economic Impact Analysis of CPV Towantic, LLC’s Construction and Operation of an 805 MW Electricity Generation Facility in Oxford, CT                 January 2015
      CCEA forecasts the construction and operation of the CPV Towantic Energy Center in Oxford, CT will generate more than $7.9 billion in additional personal income for Connecticut households, increase real state GDP by more than 7.8 billion, and create significant employment, over the next 25 years.

Predictability of How Single-Family Home Values Respond to a Changing Neighborhood: The Case of Oxford, CT                 November 2014
      This essay offers a high-level review of academic literature that evaluates factors impacting the valuation of single-family residential real estate. The focus is on the impact exogenous events can, may, or will likely have on those residential values. The assessment concludes with a view of the specific situation in Oxford, CT, where construction of a fossil fuel (primarily natural gas) power generation plant has been licensed.


CCEA in the News

December 2014 - CCEA Director Fred Carstensen suggests an Idea to Lessen Federal Taxes for CT Taxpayers without reducing CT tax revenues, to the CT Mirror. He hopes a congressional study group will review (1) replacing the current state property tax credit for households (2) while "crediting" the same amount to low-income families as a sales tax rebate. The benefit is that the rebate does not get summed into the federal "Adjusted Gross Income" line, whereas the current property credit is taxable.

Video from CCEA Partner, Mansfield Advocates for Children (MAC)

      for their Community Connectedness initiative: the Mansfield Community Playgroound :
is pleased to announce: We're Building a Playground, the story of their preparation for their hoped-for Spring 2015 build-out.

    CCEA has collaborated with and contributed to MAC's initiatives since 2012, assisting by providing analysis and recommendations for the Town of Mansfield's Early Childhood Office and the volunteer MAC teams as they focus on their goal:
    All Mansfield Children ages birth through 8 years old are healthy, successful learners, and their families are connected to the community.


Updated June 1, 2015.