Lawmakers are scheduled to be briefed
Some of the reasons
Both OFA's report and a similar document released by Malloy's budget office also note increases in medical, dental and pharmacy costs for retired state employees. The jump in retiree health spending is expected to climb by
Malloy has taken steps to reduce pension costs during his six-year tenure, including benefit changes for new state hires. But he argued this week that previous governors hold much of the blame for budget shortfall because they agreed not to fully fund state pensions.
"I don't believe people understand that a lack of paying the bills as they should have been paid has led to the current difficulties the state of
It's been years now, but
According to the state's
Meanwhile, recent state revenue estimates indicate the upcoming two-year general fund account will have about
The current fiscal year, which ends
Malloy, however, contends there are "some indications of some strength in the marketplace," mentioning gains in the stock market.
Besides slower-than-anticipated revenues and looming pension payments,
For example, it's expected they'll have to find the money to make a final
Lawmakers will have less sales tax revenue to spend, as well. More money generated by the tax is scheduled to be moved from the general fund to pay for transportation improvements and a new program aimed at lowering local property taxes. Also, OFA notes that state borrowing has "increased significantly in the last few years," which is driving up the cost of debt payments.
Malloy, who has been criticized for two major tax increases during his tenure, coupled with cuts to social service programs, said this week he's considering making adjustments to business taxes to make the state more competitive. However, he said he doesn't expect having to "raise a lot of additional dollars" through tax increases in his new budget proposal, which is expected in February. Malloy's state agency heads have provided him with various options to accommodate a possible 10 percent cut in discretionary funding. He's said it's too soon to say whether more state employees will need to be laid off.