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IFTA: Connecticut is a Money 'Sinkhole'

The state budget is strapped for cash and one of the five worst most-indebted in the country.

THE ADJUSTMENT BUREAU

There’s not a whole lot of wiggle room in the state budget, according to the Office of Fiscal Analysis.

The non-partisan OFA projects funding deficiencies of $65.2 million shortfall in the General Fund and $1.3 million in the Transportation Fund.

“Given the fact that the Governor's budget increased spending this year over last in the middle of a down economy, I'm not surprised. It's really a shame we didn't see more fiscal restraint,” said state Rep. Jason Perillo, a Republican representing Shelton in the 1113th House District.

Ben Barnes, Secretary of the Office of Policy and Management, said he appreciates the concern, but that the deficiencies are small.

“I’m confident we will reverse that and finish the year in balance and under the spending cap,” Barnes said.

A Nov. 15 OFA report projects a $101.2 million General Fund surplus, which the legislature could use to cover any agency deficiencies. In addition, the estimated $66.5 million deficiency represents only one-third of one percent of the annual $18.7 billion state budget, according to a source in the State House.

The numbers only tell part of the story, said state Rep. Chris Perone, a Democrat representing Norwalk in the 137th House District.

“The revenues are a bit in flux because of the state of the economy. So this can change from month to month,” Perone said.

"For one, the state’s sales tax and Indian gaming revenues (tax revenue from the casinos) were also off and had to be adjusted downward which contributed to some of the fluctuations in Connecticut’s revenue stream(s)," Perone said.

State Sen. Toni Boucher, a Republican representing Bethel, Easton, New Canaan, Redding, Ridgefield, Weston and Westport in the 26th Senate District, said she doesn’t like the deficiency.

“If the deficits run high it means the budget isn’t balanced,” she said. “If adjustments are needed the question will be where to get the money. The union contracts said no firing for four years. So that leaves only two choices – either tax or cut spending. But I don’t think there is room to go in that (tax increase) direction. I don’t think that would be a good thing, then again we passed a few things I don’t think were good.”

The numbers reflect the state is still reeling from losing 119,200 jobs during last recession and an expected staying of high unemployment, according to Fiscal Accountability Report.

Even so, the General Assembly must be mindful of the deficiencies, no matter their size.

“The state must think twice about asking for large expenditures,” Perone said, adding he wants to see clearer and more timely reporting of how agencies are spending money.

SINKHOLE

The Institute for Truth in Accounting, IFTA, called Connecticut a "Sinkhole" state. The non-partisan agency said The Nutmeg State is one of five states in the worst financial position in the country. According to IFTA, while Connecticut has $29.4 billion worth of assets, only $10.1 billion are available to pay $63.4 billion of bills as they come due. IFTA also said each taxpayer's financial burden is $41,200.

“It’s a point well taken, and I certainly can’t deny that Connecticut faces some financial challenges,” Barnes said.

However, Barnes said the report doesn't recognize changes made to how Connecticut structures its budget, such as GAAP, or Generally Accepted Accounting Principles.

“My wife reminded me the other day that a year ago I said yes to this job,” Barnes said. “We had a structural deficit of $3.5 billion and a structural deficit going out as far as the eye could see.

“Yesterday’s report was one point on a very long line. It’s still too early to draw any conclusions, though I will note that the state budget is still on track to end the fiscal year with a $101 million surplus, according to OFA,” said Lawrence Cookspokesman for the Senate Democrats. 

SOMETHING FISHY’S GOING ON…

Capitol DisPatch took the bait after seeing a small ad posted on CT Capitol Report and asked local lawmakers about what’s being done to save this little fish in a big pond.

It seems CD wasn’t the only one to click on the brightly colored ad. Norwalk’s Perone also checked out the ad.

“My initial inclination is to protect our indigenous fish, flora and fauna,” Perone said. “We need to revisit whether there is too much fertilizer run-off going into the sound which grows algae and kills our ecology.”

Also known as bony fish, poggies, bunkers and fatbacks, this fish by any other name is still bait. And once upon a time Connecticut pioneered the menhaden industry, turning fish into fertilizer and animal feed.

HIRE VETS FIRST

The state has a new website that connects job-seeking military veterans and employers interested in hiring them.

The HIRE VETS FIRST! Services to Employers website was developed specifically for Connecticut’s veterans, who commonly experience difficulty finding employment when they return from active duty.

Boucher posted announcement on her Facebook almost as soon as it was available.

After what she described as a wonderful experience at the  in Wilton on Veterans Day where she sat next to Iraq War Veteran U.S. Army Captain Brandon Davis, a West Point graduate, who plans to return to school.

“You hope he’s able to find a job,” Boucher said. “They sacrificed their time away and especially these days with jobs being so scarce.”

Eustace Tilley November 21, 2011 at 11:51 AM
Try this: http://townhall.com/columnists/pauljacob/2011/11/20/benefits_for_the_few,_bankruptcy_for_the_many and this: http://danieljmitchell.files.wordpress.com/2011/11/ss-big-government.jpg

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