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CT Faces a Budget Deadline of July 1. What Happens if There’s No Budget?

June 22, 2017 By Staff
CT Faces a Budget Deadline of July 1. What Happens if There’s No Budget?

Dan Malloy has outlined his principles for operating state government without a budget. Will the state reach that point come July 1?

Connecticut is coming very close to having to operate state government without a budget, as the July 1 deadline approaches with no clear budget in place.

On Wednesday, Gov. Dan Malloy (D-Conn.) listed five principles that will govern his plan “for managing state government to maintain essential services and satisfy obligations that are critical to the functioning of the state.”

THE FIVE

Those five principles?

  • Don’t increase the deficit
  • Prioritize funding “for our most vulnerable residents” first
  • Consider the “fiscal capacity” of towns and cities (could this mean cuts to local aid?)
  • Comply with court orders and mandates
  • Honor the “tentative” deal Malloy made with state unions (could this mean no layoffs?)

OTHER OPTIONS

Malloy’s plan may not be the only one advanced in the state this week and next. The CT Mirror reported on Wednesday that the legislature may vote on a “continuing resolution” that would run state government until a budget is in place.

Every day without a two-year budget, though, can hurt the state. The Hartford Courant reported as much on Wednesday, writing that the lack of a plan could lead to “across-the-board cuts” and that the lack of “increased taxes” from the new budget could push the deficit for fiscal year (FY) 2018 even higher.

Either way, Wall Street rating agencies will not look favorably on the impasse. The lack of a deal may also make voters, who go to the polls in about 18 months, more likely to vote for a change.