- Associated Press - Monday, June 1, 2015

FAIRFIELD, Conn. (AP) - In a public lobbying campaign with little precedent, leading businesses in Connecticut urged the legislature Monday to pull back from a proposed budget that boosts taxes for the second time in four years.

General Electric Co., Aetna Inc. and the Travelers Companies Inc. criticized a budget deal hammered out over the weekend by Gov. Dannel P. Malloy and his fellow Democrats who run the legislature. GE and Aetna even questioned whether businesses and individual taxpayers should stay in Connecticut.

GE said in a statement on its website that the proposed tax increase is “truly discouraging.”

“Retroactively raising taxes again on Connecticut’s residents, businesses and services makes businesses, including our own, and citizens seriously consider whether it makes any sense to continue to be located in this state,” the Fairfield-based company said.

Connecticut’s economy “continues to struggle” as other states offer more opportunities and a better environment for business growth, said GE, which employs about 5,700 in the state. It urged Malloy and the legislature’s Democratic leadership to find a “more prudent and responsible path forward.”

Aetna said Connecticut is in danger of damaging its future by “failing to address its budget obligation in a responsible way.”

“Such an action will result in Aetna looking to reconsider the viability of continuing major operations in the state,” the health insurer said.

Travelers said raising taxes again will increase the cost of living “for nearly every resident and small business in the state.”

“Lawmakers should explore other solutions to the state’s budget to help keep Connecticut competitive and make it a desirable place to live and work,” the property casualty insurer said.

Joe Brennan, president of the Connecticut Business and Industry Association, said the extent of public pressure on lawmakers is unusual.

“I’ve been here 27 years and never saw anything like that before,” he said.

Legislators were scheduled to vote Monday on the proposal that includes tax increases for high net-worth individuals and certain business activities. State budget negotiators went back behind closed doors Monday night, considering last-minute changes after the companies’ criticism.

Malloy and Democratic leaders of the legislature have proposed major changes corporate taxes and significant increases in the sales tax on computer services, according to the Connecticut Business and Industry Association.

Malloy defended the budget deal on Monday, saying it will add billions of dollars for needed improvements in transportation while avoiding higher income taxes on the middle class.

But Republicans who oppose the budget plan picked up on GE’s comments.

Rep. John Frey, R-Ridgefield, said at meeting Monday of the legislature’s Finance, Revenue and Bonding Committee that GE’s chief financial officer, Jeffrey Bornstein, contacted him and expressed concern about the proposed tax and spending increases.

“The bottom line was whether GE reconsiders whether they continue to call Connecticut home,” he said. “I’m almost trembling again.”

A spokesman for GE confirmed that Bornstein spoke with Frey, but would not comment.

Rep. Toni Boucher, R-Wilton, called it a “devastating blow to learn that potentially they could be forced to consider another location.”

Small businesses also lobbied against the budget plan. The National Federation of Independent Business called it “exhausting for small business owners to continue to watch as lawmakers in this state make the economic climate less and less conducive to success.”

“This budget will unequivocally raise taxes, in one form or another, on taxpaying citizens throughout Connecticut,” the group said.

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Follow Stephen Singer on Twitter at https://twitter.com/SteveSinger10

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