As of Tuesday, three of the four Wall Street credit rating agencies have downgraded Connecticut’s bonds since May.

Kroll Bond Rating Agency was the latest credit rating agency Tuesday to downgrade Connecticut from AA to AA-.

Standard & Poor’s and Fitch Ratings lowered Connecticut’s general obligation bonds from AA to AA- in May. That same month, Moody’s Investors Service affirmed its rating, but gave the state a negative outlook.

The “decision to downgrade the State’s General Obligation Bond rating is based on the State’s inability over the last two years to maintain balanced financial operations without significantly reducing its Budget Reserve Fund,” Kroll analysts wrote in a report published Tuesday.

Analysts said the highly progressive income tax structure and its reliance on capital gain taxes expose Connecticut’s revenue base to the performance of the stock market.

“Approximately 15 percent of total income tax collections are capital gains taxes,which reflects the high wealth levels of the State,” Kroll analysts wrote. “The volatility of the stock market over the last two years and the difficulty in forecasting the level of capital gains taxes has been a major factor in the State’s overestimation of income tax collections. The level of capital gains taxes has always been difficult to predict; however, the State’s relatively modest level of reserves has provided less cushion to absorb the impact of market fluctuations than in pre-recession times.”

Kroll pointed out that in 2015 the state drew down its modest Rainy Day Fund from $519.2 million to $406 million and is expected to lower it again to $90.2 million when it closes the books on the 2016 budget in September.

“The state currently has no specific plans to increase funding,” to the Rainy Day Fund, analysts wrote.

Kroll analysts pointed out that Connecticut lawmakers have taken action to correct deficits, however, it has less margin for error with a Rainy Day Fund that’s equal to about 0.5 percent of expenditures.

A spokesman for Democratic Gov. Dannel P. Malloy said the report reinforces the administration’s message.

“The ratings agencies findings demonstrate what we have been saying and continue to say: we are in a new economic reality and we must continue to align state government to that reality,” Chris McClure, a Malloy spokesman, said. “As the world changes, we must change with it. We must keep adjusting.”

State Treasurer Denise Nappier said she didn’t believe the downgrade would impact the sale of $500 million in general obligation bonds.

“Kroll’s rating is now in line with those of the other three rating agencies, and it should not significantly affect our $500 million General Obligation bond sale scheduled for August 3,” Nappier said. “One saving grace is that all four of the State’s credit ratings remain in the high-quality ‘double A’ category.”

Republican lawmakers contend the state failed to make the structural changes it needed to make when it adopted the 2017 budget in May that cut spending and didn’t increase taxes.

A spokesman for Senate Minority Leader Len Fasano, R-North Haven, referred to previous comments the senator has made regarding downgrades.

“By building budgets for elections and not generations, Connecticut hasn’t made the structural changes needed to ease the minds of credit rating agencies,” Fasano has said. “The Democrat majority has failed to mitigate higher debt in future budgets – budgets that will fall onto the backs of our children and our grandchildren.”