Connecticut Gov. Dannel Malloy expressed skepticism Thursday over President Donald Trump's trillion-dollar infrastructure plan and emphasized that federal help is necessary to upgrade the state's roads and bridges.
In an exclusive interview with CNBC, Malloy warned that Trump's proposal has yet to be fleshed out. The president met with real estate developers for a working lunch at the White House recently but has not released specifics on how the investment should be structured or financed.
"It's like a lot of things the president has said," Malloy told CNBC. "We have a title. It's an infrastructure plan. We don't have any details, so I get nervous about that — whether it's real."
Connecticut faces a $1.7 billion budget shortfall in the coming fiscal year, and Malloy has proposed dramatic spending cuts to plug the hole.
One of the most controversial measures calls for shifting a third of the state's teacher pension obligations — or about $408 million — to local governments. The governor's budget would also reduce funding for higher education by 4.3 percent and cut labor costs by $700 million, potentially forcing unions to renegotiate their contracts or face layoffs, according to S&P Global Ratings.
"If implemented, these proposals will create winners and losers," S&P credit analyst Victor Medeiros said in a research note. "The credit impact on local governments could be negative should they not be able to adequately adjust to this new funding paradigm."
Still, Malloy has proposed a $100 billion plan to improve state infrastructure over the next 30 years. In his interview with CNBC, Malloy suggested raising the state's gas or sales tax to pay for it. But he reiterated that he would not pursue those increases without a so-called lockbox that to ensure the funds would not be raided for other programs.
Malloy also cautioned against overly relying on private sector partnerships to fund infrastructure projects and pushed instead for more direct federal investment.
"These aren't about Connecticut roads just for Connecticut citizens," Malloy told CNBC. "We have a lot of folks driving through our states. We have a lot of goods moving through our state. We have a lot of jet engines being shipped out of our states. The nation needs to rise to the occasion. ... The federal government needs to play a larger role."