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State Budget Deficit up Another $50 Million

Officials for Gov. Dannel P. Malloy disagree with the Connecticut comptroller's deficit figures, but acknowledge they must now file a deficit mitigation plan with the legislature.

State Comptroller Kevin P. Lembo says the state's mushrooming budget deficit has jumped by another $50 million, bringing the official deficit figure today to $415 million.

However, because of a technical accounting glitch, Lembo's office has not factored in to that figure Gov. Dannel P. Malloy's recently ordered budget cuts, the Connecticut Mirror reports.

When those cuts are calculated, the website reports, it brings the actual deficit closer to $290 million.

Malloy's office, meanwhile, is questioning Lembo's deficit figures. Malloy officials say they don't believe the deficit is as high as Lembo is estimating, but offered no reason for why they don't agree with the comptrollers calculations, the Mirror reports.

Lembo said the state's budget woes are, in part, the result of higher than expect spending on Medicaid. Malloy has said he will file a deficit mitigation plan with the legislature before year's end. He has blamed the state's fiscal problems on the enduring and lingering impacts in Connecticut of the nation's economic downturn.

In an effort to lower the deficit, Malloy last week announced $170 million in budget cuts, the maximum allowed by a governor without needing legislative approval. 

QWERTY December 05, 2012 at 04:31 AM
This guy doesn't agree with anyone's numbers. According to him, the Department of Labor is wrong about unemployment numbers in CT too.
Alex December 05, 2012 at 01:58 PM
"Malloy's office, meanwhile, is questioning Lembo's deficit figures. Malloy officials say they don't believe the deficit is as high as Lembo is estimating, but offered no reason for why they don't agree with the comptrollers calculations" That smacks of desperation. You don't agree with your own governments figures but can't explain why you don't? This is why you don't base your budget off of the best possible scenario, but rather worst case scenario or the very least most likely scenario. If Malloy and his staff didn't assume we'd have more revenue than we'd really bring in then we wouldn't be scrambling at the end of the year. Now with such a big deficit, which by law must be balanced, things like educational grants for our towns may be in question.
Bart Shuldman December 05, 2012 at 10:50 PM
If you have not heard, the State of CT needs to borrow money to pay every day bills. Things are getting really bad. It was just announced the state of Connecticut is so low on cash, state Treasurer Denise Nappier is seeking Gov. Dannel P. Malloy’s approval to seek up to $550 million in credit. Connecticut has depleted all but $103 million of the $1.4 billion budget reserve as the state’s cash position has steadily fallen. The treasurer had to transfer $366 million from bond fund investment accounts. The common cash pool has a negative balance. The treasurer has requested, and Governor Malloy has approved, the need to borrow funds externally in order to fund cash flow requirements for current operations. This is really bad, as Governor Malloy instituted the largest tax increase in the state’s history and we are now running a huge deficit. In addition, Governor Malloy granted the state employees a no-layoff agreement for the next 4 years. Our unemployment just passed 9%. Just thought you might want to know how bad things are getting in Connecticut.
Bart Shuldman December 06, 2012 at 12:25 AM
The real amount for the pensions is $60 BILLION. When you use the right discount rate, the states liabilities are $60 BILLION. if the state used GAAP accounting, Malloy would have to announce the state is bankrupt. And Malloy guaranteed the use of overtime for the pension plan for another 11 Years. 11 years. Malloy is a disaster and his policies are now coming thru.

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