Thanks to big government Democrats Connecticut once again will come up short on cash.
Connecticut is once again coming up short on cash, and its rainy-day fund is already strained.
About halfway into the budget year, sales and income tax revenues have come in about $208 million under projections. That comes even after lawmakers enacted deep spending cuts, raised fees on motor-vehicle registrations and required teachers to contribute more to their pensions to pass a two-year budget in a bruising process that took 10 months.
Shortfalls have “caused us to tap our rainy-day fund, our budget-reserve funds,” Paul Potamianos, the state’s executive budget officer, said on a conference call. “This is a problem for us because our reserves are not growing,” even though the nation is not in a recession, he said.
The state’s reserves of $213 million currently comprise about 1.1% of expenditures. That compares with a forecasted median of 5.1% around the U.S. this fiscal year, according to a report released Thursday by the National Association of State Budget Officers, or Nasbo.
Connecticut Gov. Dannel Malloy, a Democrat, sent lawmakers a proposal Wednesday to close its budget hole. Mr. Malloy is recommending a mix of spending cuts and tax increases including on sales and cigarettes.
Despite a growing national economy, Connecticut is one of a few outlier states that have dipped into their reserves—funds saved to help buffer against the next economic downturn, according to the Nasbo report.
More bad news for Connecticut. As with most big government Democrat-run states, the tax hikes never stop. As they control the economy less money is to be had. If you keep taxing the rich they will leave and then you’ll end up with no money at all.