The budget deficit is getting larger again. It’s up to $338 million, says Comptroller Nancy Wyman, and that’s with the meager cuts made by the legislature factored in.
Two things about this article that are worth pondering:
Wyman again called on the Governor and the legislature to address not only the current revenue shortfall, but an additional $500 million “structural deficit” that has been created by using prior years’ surplus funds to pay for current expenses.
This is something we don’t hear much about, but I’m glad Wyman has brought it up. Using one-time revenues, including surpluses, to fund programs intended to be permanent is bad policy.
Secondly, here’s something I didn’t know:
If no plan is created to deal with the overall deficit by the end of the fiscal year June 30, she said, state law requires that any deficit be automatically covered by the state’s Rainy Day Fund, which now stands at about $1.4 billion.
So theoretically, the legislature could do very little to solve the budget problems. The Rainy Day Fund is acting something like a safety net–for this year, at least. There’s not nearly enough in there to fix the state’s yawning deficit for the 2010-11 biennium.
But I can’t imagine the legislature doing that. …Right?
I have to say, their very weak actions last week don’t give me much confidence in their ability to make hard calls. If programs or positions can be cut, cut them. If contracts can be renegotiated with the unions, renegotiate them. If programs/employees absolutely should be kept, then find a way (including raising taxes) to pay for them.
Just don’t pass the buck. There really isn’t much buck-passing room left, anyway.
Stuart, Christine. “State Deficit Continues To Grow.” CT News Junkie 1 December, 2008.