HARTFORD – Governor Dannel Malloy has quietly authorized a $550 million line of credit to help pay the state's operating expenses, just the latest evidence of how perilous Connecticut's finances have become, Deputy House Republican Leader Vincent J. Candelora (R-86) said today.
"The state's finances have now decayed to the point where we have gone from the dubious policy of transferring money from bond issuances to cover operating costs, to the truly damaging process of turning to external sources of borrowing to meet our obligations," said Candelora.
The Governor made the stealthy and understated authorization at 5:00 PM on Monday evening. Republicans predicted months ago that given the continued state of spending and lack of revenue that this day would be inevitable. Candelora once again called on State Treasurer Denise Napier to explain the state's cash position and how and when it intends to use the line of credit.
Candelora noted that the lack of transparency by the administration surrounding the true fiscal picture of the state was unacceptable. "For months Republicans have asked for a full accounting of the state's cash flow and projections for the future," said Candelora. "This state has temporarily transferred nearly $1.6 billion in bond issuances on a monthly basis just to pay its bills and keep the lights on. Placing band-aids on these gaping fiscal wounds is hardly a substitute for having an actual fiscal policy, and demonstrates a frightening lack of planning on the part of the administration."
The authorization for the $550 million line of credit combines with the State Comptroller's troubling report of a projected $415 million budget deficit, a record-level low amount of cash on hand, and a downgrading of the state's bond rating to paint a dismal picture of a Connecticut far from the recovery promised by the Governor two years ago which was to be achieved by "shared sacrifice."
"In the final analysis, Connecticut taxpayers were forced to suck up a nearly $2 billion tax increase, and in many ways, we are worse off for it," said Candelora. "If this administration is serious about fixing the problem, they will have to look at serious policy changes."
Rep. Vincent Candelora represents the 86th General Assembly District covering North Branford, Wallingford and East Haven.