HARTFORD – State Senate President Pro Tempore Martin Looney (D-New Haven) and the Connecticut State Senate voted today on an overwhelming and bipartisan basis to financially help the estimated 1,500 federal employees who live and work in Connecticut but who have been furloughed without pay due to President Donald Trump’s ongoing federal government shutdown.
The Senate voted 32-1 in favor of House Bill 5765, “AN ACT ESTABLISHING THE FEDERAL SHUTDOWN AFFECTED EMPLOYEES LOAN PROGRAM AND PROVIDING ADDITIONAL ASSISTANCE TO FEDERAL EMPLOYEES.”
This bill was sponsored by all six legislative leaders from both the Democratic and Republican caucuses, and was crafted with the input and endorsement of Governor Ned Lamont and the Connecticut Bankers Association.
“As President Trump continues his extreme and irrational government shutdown, today in Connecticut we are taking steps to provide relief for federal employees in our state,” said Senate President Pro Tempore Martin Looney (D-New Haven). “With the government on day 31 of the shutdown these workers and their families, through no fault of their own, face terrible financial stress. These no interest loans will create immediate support to Connecticut families as we wait for the Trump shutdown to end. In addition, municipalities will be allowed to defer local property taxes and water or sewer payments during this period including any statutory penalties for late payments.”
The bill – which becomes effective immediately upon Governor Ned Lamont’s signature – affects approximately 1,500 federal furloughed employees, non-furloughed employees, and furloughed employees who have bene called back to work.
The new program calls for the Connecticut Housing Finance Authority (CHFA) to guarantees loans to eligible employees from private banks. The loans are equal to $5,000 or the regular monthly take-home pay of an employee (whichever is lower), minus any unemployment the employee may be receiving.
Eligible employees may receive up to three loans, one for each 30 day period of the shutdown. Loans are interest-free for 270 days after the shutdown, and the loans must be repaid within 270 days of the end of the federal shutdown in three to six installment payments.
The State of Connecticut is guaranteeing just 10% of the aggregate amount loaned.
The bill also allows (but does not require) municipalities and/or special taxing districts to offer local tax deferment programs and/or water/sewer payment deferments to federal employees affected by the shutdown.