The shortfalls are due largely to the coronavirus-induced recession.
Nonpartisan analysts reminded lawmakers Wednesday that the next recession could be right around the corner.
Despite a 12-month surge in state tax receipts, Gov. Dannel P. Malloy’s budget office warned Thursday that Connecticut’s pension obligations and other debt will grow faster than revenues in the coming years.
Legislators have left more decisions on cuts up to the governor, avoided votes on state employee raises and have accepted less information on fiscal matters. Fourth in a series.
Surging debt costs and shrinking revenues alone will force state officials to cut $1.1 billion to $1.3 billion out of the next state budget to avoid tax hikes, according to separate analyses Tuesday from two fiscal agencies. But the two reports probably still don’t reflect the full cuts to discretionary programs that would be required to stave off tax hikes.
Gov. Dannel P. Malloy insists recently adopted legislation that restricts how nonpartisan staff report future budget trends — including deficits — will help ensure state spending doesn’t increase “on autopilot.” But the measure places no restrictions on what the legislature can propose or adopt, nor will it prevent legislators from obtaining the material nonpartisan analysts will not be able to publish in one high-profile report.
Nonpartisan fiscal analysts issued projections Friday that Connecticut, already coping with a significant budget shortfall in the current year, is facing a far worse problem just over the horizon: nearly a $2.3 billion gap in state finances over the next two fiscal years.
The legislature’s two budget-writing panels grilled Gov. Dannel P. Malloy’s fiscal staff Friday about the new state deficit – and the administration’s latest cuts to reduce it. Republican legislators focused, as expected, on why the $99 million shortfall Malloy reported last week wasn’t acknowledged before Election Day.
The state budget received its first official deficit reports Friday when nonpartisan legislative analysts and Gov. Dannel P. Malloy’s administration projected shortfalls ranging from $89 million to just under $100 million. Budget director Benjamin Barnes, insisted it quickly would be closed, and reasserted Malloy’s insistence that tax hikes are not an option. (File photo: Gov. Malloy and budget director Barnes)