one of the government. Ned Lamont’s goal when he took office was to try to make Connecticut a more business-friendly state after years of being the opposite of Connecticut’s reputation.
One of the key people who helped him do that was David Lehman, a former Wall Street executive turned economic and community development commissioner.
Now, as the governor begins his second term, Lehman says he will step down. He talks about whether Connecticut is a better place for business now than it was four years ago.
Mike Heidecker: So let’s talk history first. General Electric leaves Connecticut. Years later, the chief executives of major insurers have also threatened to leave if the public option is passed. Big business looks bleak at this point. Now evaluate it by comparison.
David Lehman: Countries are in very different positions. So on the financial side, you know, we’ve had four consecutive years of surplus. We have nearly $6 billion in debt paid into our pensions, and this is a problem that needs to be addressed and will continue to be addressed over time. You have a rainy day fund of $3.3 billion. Fiscal stability and tax certainty are therefore of paramount importance. That word got out and will continue to get out from the Governor. And now, if you look at the Connecticut numbers, record business starts. Starting in Connecticut, you’ll see approximately 1,100 businesses per month. We haven’t seen those numbers in the state since 2006, so 15 years. If you look at the larger businesses, you’ll see stability, and you’ll see a lot of people choosing to grow or come to Connecticut to grow. So I think you’re seeing a very different Connecticut from a business standpoint. I think the data bears that out.
Mike Heidecker: On the bright side, Sikorsky signed another lease to stay here, another good thing for a big company. So, you said a lot of startups, which means that in general, those are small businesses. So we hear from local and national politicians that small business owners make up the engine that drives our economy. There are a lot of people here who help supply Sikorsky and other big businesses. I recently spoke with a group of business owners from various industries. One, the third-generation head of a family business, who asked me what it means for a big company to take care of everything? The electricity bill to run his machines in his machine shop is a burden, he said. Is there a bag that can help the little one?
David Lehman: Yes, so a couple of things. I mean, we’re very focused. Small businesses are the engines that drive economic growth. One of the reasons I am so optimistic about the future of the economy is record small business formation. These are businesses that are going to hire, that are going to grow, and we’re very focused on making sure that those businesses are successful in the state. One of the things that we’ve done in the first four years of Governor Lamont’s leadership is scale back a lot of big incentives in a meaningful way, big breakouts, I think you mentioned two big businesses. As a result, almost $600 million was guaranteed or borrowed as an incentive during the last three years of the previous administration. Most of that went to larger businesses, some smaller. For the first three years, or three and a half years at Lamont, that number was about $150 million. So over $400 million in savings, less borrowing. So we’re really reducing those incentives. We’re focused on leveling the playing field for everyone, and we’re focused on those small businesses. The Governor also recently launched a Small Business Booster Program where we will provide small businesses with loans of $5,000 to $500,000. So there’s less focus on big incentive programs and more focus on very formulaic performance-based incentives and programs for small businesses as well as for communities across the state.
Mike Heidecker: For small businesses that are often busy making widgets and trying to get new customers, messaging is a major part of that business boosting plan. what is it called How do they apply? Where do they find more information about it?
David Lehman: Yes, so CTsmallbusinessboostfund.org is the website. They just google CT Small Business Boost and you see this is a website where you can again get free access to $5,000 to $500,000 loans from many different lenders. The entire application process is on that website. It’s not just loans. Technical assistance is also available if a business is looking for a little help or to be referred to someone who can help them with business planning, budgeting, etc. without funding.
Mike Heidecker: Another thing, I talked to a real estate agent. Here’s another example of them serving 40 years in Connecticut saying things that happen year after year seem like money grabs from the state to those experienced in their industry, like annual license fees . If I were a salesperson, I would be in the field and I have a proven track record. I still pay X amount, a few hundred dollars a year, three or four hundred dollars a year.what is your response [that]? Seems like if you’ve been there and done that, you shouldn’t have to pay that much, right?
David Lehman: Yes, the focus is on mitigating some of these costs, such as the bi-annual sales tax that the governor reviewed in 2019. But certain administrative fees, you know, those fees are necessary to administer certain licenses and programs that are out there. So there’s an emphasis, it shouldn’t be seen as a money grab, but rather a small overhead that we think is appropriate in certain areas. But in the end, it’s not a source of income or big money. This is what is needed to manage certain licenses and certain programs for businesses.
MeterIke Heidecker: So I have about a minute and it’s not the easiest question to answer quickly. Health care costs are killing small businesses. Trying to reform healthcare costs from zero to 50 employees is very, very difficult. What steps are being taken to address this issue?
David Lehman: Yeah, so I think you should expect more in the next year or a few years to get the business involved in addressing healthcare costs. Because in many cases, health care costs have been rising and outpacing inflation. So we want to work with business, and the government wants to work with business, to try to reduce some of the common sense, or where we can limit the growth of healthcare costs. So the health care system is complex and as you know, as you mentioned, it’s a tougher issue in a minute, but there’s a goal, and you’re going to see the business community getting more involved, trying to work with the government to bring down These costs. Because we agree that this is an impediment, not only in Connecticut but nationally, but needs to be addressed.
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