State Budgets: Connecticut Considering Options for Large Shortfall

In November, Connecticut legislators held a special session and approved $71.8 million in cuts (plus a tax amnesty program expected to generate $40 million, but lawmakers rejected a move to seize $40 million in unclaimed deposits on bottles and cans). Since then, the shortfall in the current biennium’s $18 billion budget has reopened and now stands somewhere between $288 million and $320 million. The 2009-11 biennial budget (unveiled in February) reportedly has a staggering $6 billion shortfall ($2.6 billion the first year and $3.3 billion for the second year). Gov. M. Jodi Rell (R) has requested that all state departments cut their 2009-11 budgets by 10% but has ruled out tax increases and layoffs. She has also called a lame-duck special session for January 2 to address the current year’s shortfall. Connecticut has a $1.4 billion rainy day fund that remains untapped.

More on Connecticut here.