Lamont: Connecticut's Rainy Day Fund Will Keep State Afloat

Sep 4, 2020

Connecticut’s finances are in relatively good shape despite the latest projection that the state might face a $2.1 billion deficit in fiscal year 2021, according to Governor Ned Lamont. 

Lamont said he doesn’t plan to seek new taxes or cut services to close the projected deficit. He said that’s because Connecticut has a rainy day fund that's now more than $3 billion dollars, or 15.1 percent of the state's general fund — a record high. Lamont also expects Congress to soon take action on another federal stimulus package.

“Thankfully we’ve kept in place our rainy day fund. That means we don’t have to pull the trigger like a lot of our other states have on some of these issues. And I’m still hopeful that Congress is going to step-up and do the right thing,” he said.

Comptroller Kevin Lembo forecast the $2.1 billion deficit for fiscal year 2021 early this week. But warned that the economic uncertainty due to the COVID-19 pandemic makes forecasting revenue changes challenging. Connecticut ended its last fiscal year in June with a $138 million surplus even though a deficit had been projected at the beginning of the pandemic.