State Controller estimates deficit at over $338 million; Rell will have to take a position.
Governor Rell, whose principal talent is a knack for public relations, has consistently outflanked the Democratic Legislature on issue after issue. But facts are facts, and the Governor has certain responsibilities that, sooner or later, she is going to have to come to grips with.
Particularly, Connecticut needs its Governor to take a clear and specific position – beyond the carefully worded, buck-passing press releases that are her trademark – on what, specifically, she wants the Legislature to do about the ballooning budget deficit. And at this point, it looks like the law may force her to.
Excerpt:
Wyman’s estimate – which is about $50 million higher than that made by the Governor’s budget office – includes the $71.8 million in deficit-mitigation cuts passed by the General Assembly late last month. Because the deficit estimate now exceeds one percent of total General Fund appropriations for fiscal 2009, or $177 million, the Governor is required to submit a new mitigation plan to the legislature within 30 days. …
Wyman again called on the Governor and the legislature to address not only the current revenue shortfall, but an additional $500 million “structural deficit” that has been created by using prior years’ surplus funds to pay for current expenses. If no plan is created to deal with the overall deficit by the end of the fiscal year June 30, she said, state law requires that any deficit be automatically covered by the state’s Rainy Day Fund, which now stands at about $1.4 billion.
[emphasis added]
Rell consistently wins the game of chicken with the Legislature, forcing the Democrats to bear the burden of responsibility while claiming credit for whatever good the voters might perceive is coming from Hartford; and Minority Leader Cafero did his rhetorical best to box the majority in before last week’s vote on the deficit-mitigating measures passed last week. But circumstances conspire to tilt the table for incoming Speaker Chris Donovan.
The full text of today’s press release from Controller Wyman after the jump:
State Comptroller Nancy Wyman today said the state’s projected budget deficit has more than tripled in the past month to $338 million, and is expected to grow larger by the end of the fiscal year.
Wyman’s estimate – which is about $50 million higher than that made by the Governor’s budget office – includes the $71.8 million in deficit-mitigation cuts passed by the General Assembly late last month. Because the deficit estimate now exceeds one percent of total General Fund appropriations for fiscal 2009, or $177 million, the Governor is required to submit a new mitigation plan to the legislature within 30 days.
“I anticipate that as deteriorating economic conditions are further reflected within actual revenue collections, my deficit estimate will rise,” Wyman wrote in her monthly report to the Governor.
The Comptroller expects the income tax to bring in about $131 million less than originally budgeted, while the sales tax is projected to drop by about $207 million.
Connecticut has lost 7,100 jobs so far this fiscal year, about half in October alone. Payroll withholding income tax receipts are down 2.8 percent from a year ago. The state’s unemployment rate of 6.5 percent is at a 15-year high.
Advance retail sales are down 4.1 percent from last year and corporate profits continue to show negative results. Existing home sales are at a 12-year low in the state.
Wyman again called on the Governor and the legislature to address not only the current revenue shortfall, but an additional $500 million “structural deficit” that has been created by using prior years’ surplus funds to pay for current expenses. If no plan is created to deal with the overall deficit by the end of the fiscal year June 30, she said, state law requires that any deficit be automatically covered by the state’s Rainy Day Fund, which now stands at about $1.4 billion.
