This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
$1 buys you full access to ALL of TheStreet's Subscription Services! Learn More

Conn. Facing 'enormously Challenging' Budgets

SUSAN HAIGH

HARTFORD, Conn. (AP) â¿¿ Connecticut is facing "an enormously challenging budget scenario" with deficits projected in the current budget and over the coming years, the state's budget director warned Thursday.

Despite efforts by Democratic Gov. Dannel P. Malloy to reduce the size of government and state employee retirement costs, Office of Policy and Management Secretary Benjamin Barnes said the lackluster national and regional economies, years of deferring Connecticut's long-term liabilities such as pension costs and a fast-growing demand for public services such as Medicaid health care coverage continue to delay the state's recovery from the Great Recession.

"This is â¿¿ I will not shrink away from it â¿¿ an enormously challenging budget scenario to be in," Barnes said.

On Thursday, he released the administration's annual fiscal accountability report to the General Assembly. It says the state's recovery from the recession has been and will continue to be slow, adversely affecting state revenue collections. The report also found that unemployment remains high and the state is vulnerable to outside forces such as the European debt crisis and the debate in Washington over how to address the so-called fiscal cliff in January when numerous spending cuts are set to kick in.

According to Barnes, the current $20 billion state budget, which ends June 30, has a shortfall of $365 million. The new budget for fiscal year 2014, which takes effect July 1, has a projected deficit of nearly $1.2 billion. That's about the same amount that expenditures are projected to exceed the state's constitutional cap on spending.

Malloy is expected to release a deficit-cutting plan for the current budget hole within weeks, which he said will not increase taxes. He's not scheduled to unveil his new two-year budget until February.

Malloy stressed that the deficit problem isn't as bad as it was two years ago, when he took office and faced $3.6 billion in red ink. But Barnes pointed out that he and Malloy likely won't have two important tools they used two years ago to help balance the books â¿¿ labor concessions from state employees and tax increases. The deal with the state employee has already been inked, and Malloy said he "has no intention of raising taxes" to address next fiscal year's problems.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,810.06 +91.06 0.51%
S&P 500 2,063.50 +10.75 0.52%
NASDAQ 4,712.97 +11.1030 0.24%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs