Christine Stuart / ctnewsjunkie
Office of Policy and Management Secretary Melissa McCaw (Christine Stuart / ctnewsjunkie)

HARTFORD, CT—Gov. Ned Lamont is proposing about $200 million in budget cuts to try to mitigate the budget deficit. The rest of the $2 billion budget deficit may be resolved by using the Rainy Day Fund. However, the administration wants to wait until next year to take any action.

The current deficit of $2 billion is 10% of the projected general fund shortfall. The governor must submit a deficit mitigation plan to the legislature when it reaches 1% of general fund spending.

Lamont’s plan mostly uses the Rainy Day Fund to plug most of the hole, but they effort will be helped by $25 million in rescissions across state agencies, $100 million in federal funds from the Coronavirus Relief, and $30 million from hiring restrictions.

Office of Policy and Management Secretary Melissa McCaw said she sees no reason for the General Assembly to come in and vote on any of the measures because new revenue projections will be available on Nov. 10 and January 15, 2021.

“We all knew the state would have some financial challenges due to the COVID pandemic and the impact on our revenues and our economy,” McCaw said. “The impact thereof, is one that is unprecedented.”

She said the state is in “unchartered territory” when it comes to estimating how the shutdown will impact the revenues.

“We believe the consensus revenue will be another opportunity to understand the extent of the deficit,” McCaw said. “There’s no time sensitivity that they take action immediately.”

But the wait-and-see approach is not sitting well with Republican lawmakers.

“The law is clear that when faced with the current budget problems, the governor must present a true deficit mitigation plan ‘to modify such allotments to the extent necessary to prevent a deficit.’ What the governor’s administration put forward today does not meet that requirement. It is incomplete,” Senate Republican Leader Len Fasano, R-North Haven, said.

Fasano said Lamont only used “4% of his rescission authority.”

Fasano said by the decision to not issue a true deficit mitigation, “the governor is creating a self-fulfilling prophesy that will put our state in a position where we have to take a significant amount from the Rainy Day Fund.”

Fasano added that the deficit could be even greater than $2 billion because it doesn’t yet include the University of Connecticut’s request for additional financial assistance and assumes savings in other areas.

McCaw defended the wait-and-see approach.

She said there’s little that’s predictable about COVID-19 and the impact it had on Connecticut’s economy, which is in the third phase of reopening.