Contact: Kevin Coughlin | kevin.coughlin@cga.ct.gov | 203-710-0193
HARTFORD – Today, Senate President Pro Tempore Martin M. Looney (D-New Haven) and Senate Majority Leader Bob Duff (D-Norwalk) released the following statement regarding revenue estimates released by the Office of Fiscal Analysis:
“Today’s revenue estimates should come as a surprise to no one: American states will lose two-thirds of a trillion dollars in tax revenue over the next three years, according to the Congressional Budget Office – and those states have just $75 billion combined in their rainy day funds. Connecticut is just one of those states.
“Fortunately, due to foresight and smart fiscal policy, Connecticut is in a much better position than most other American states to weather this fiscal downturn, at least in the short term. Connecticut has 47.4 days’ worth of daily expenses in our $2.5 billion Rainy Day Fund; the national average is about half that, or just 28 days, according to the Pew Trusts. For contrast, Massachusetts has 31 days of budget reserves, South Carolina has 24 days, Florida 16 days, Kentucky four days, and Kansas has no budget reserve at all.
“Connecticut’s Rainy Day Fund was created expressly for times like this, and with an eye on the painful memory of 2011, when after the Recession of 2008-2010, Governor Rell left incoming Governor Dannel Malloy with a $3.7 billion budget deficit and not a single penny in savings. Now we are coming up on the three-year anniversary of the Senate Democrats’ announcement of a budget predictability plan, which was spearheaded by Senator John Fonfara, which brought real structural change and stability to our state budgeting process, and which has resulted in the historically high budget reserve fund we have today.
“And at this time of great national health and fiscal emergencies, it is worth remembering that just a few months ago, Democrats had to fight off a plot by Connecticut Republicans to raid two-thirds of our Rainy Day Fund to spend on transportation projects. We believed then, and have been vindicated now, that our national economy was more precarious than it appeared, and that our budget reserve was best kept for real emergencies, and not to be used for mere political expediency.
“We still face many difficult months ahead as the tendrils of the COVID-19 pandemic will continue to infect our economy and our recovery, but for the time being, Connecticut is in a stronger position than most states thanks to our fiscal prudence and the safeguarding of our budget reserve.”
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