State Comptroller Nancy Wyman sent this letter to Republican Gov. M. Jodi Rell and legislators warning them that she has to close the books Sept. 1.
Wyman’s letter warns of the fiscal implications should the Democratically-controlled legislature and Rell fail to agree on a budget before that time.
While both sides have presented budgets which borrow money to cover the close to $1 billion 2009 budget deficit, Wyman’s letter warns that in order to balance the books she will need to use the $1.4 billion rainy day fund to cover the deficit if the legislature and governor fail to act.
In addition Wyman warns them of the use of one-time revenue.
“Every dollar of one-time revenue that is relied upon to force the budget into balance decreases the likelihood that economic growth alone will be sufficient to resolve this enormous structural imbalance,” Wyman writes.
Just how big will the deficit be in 2012 if the state fails to increase taxes and decrease spending over the next two years? About $2.5 billion.
“I believe that a more balanced approach is required in order to both resolve the current budget crisis and lay a foundation for long-term fiscal stability,” Wyman said. “In previous budget crises, a more balanced combination of spending cuts, borrowing and structural revenue increases were used to balance the state’s budget.”
“Most recently, the FY 2002 budget closed with a deficit of $817.1 million, with out-year projections of multi-billion dollar shortfalls. The General Assembly implemented spending reductions and borrowing totaling nearly $1 billion, and enacted structural revenue increases to address the remaining $1 billion imbalance for FY 2003 and the out-years,” Wyman said.