Gov. Ned Lamont is taking a victory lap for what he called the financial turnaround that Connecticut has experienced this year, citing actions by the major credit rating agencies and maintaining that the state is moving in the right direction.
“I was elected on the commitment that I would be hyper-focused on righting our fiscal ship, and in doing so changing the narrative about this great state,” Lamont said at the Dec. 18 State Bond Commission meeting. “Despite being faced with a $3.7 billion deficit, we brought stability to the state”™s finances without raising tax rates or cutting municipal aid and educational funding.
“Equally important was curtailing the state”™s borrowing and restructuring the state”™s economic development strategy to incentivize growth without jeopardizing taxpayers”™ dollars,” he added.
As proof of the latter, he noted that in March, Standard & Poor”™s improved the state”™s credit rating outlook from “stable” to “positive” ”“ the first positive outlook or rating improvement for Connecticut by a rating agency in 18 years; and that in July, the state”™s General Obligation (GO) refunding bonds were assigned an “A+” rating by Fitch and an “A1” rating by Moody’s.
Lamont also pointed out that on Dec. 17, the National Association of State Budget Officers”™ Fiscal Survey of the States found that Connecticut”™s budget growth is below the national average and the state”™s rainy day fund is almost twice the national average.
“As hard as this year has been,” the governor said, “(our) work is showing results, and Wall Street is taking notice.”
Rating agencies care about the ability of bond holders to be repaid so raising taxes and cutting ability to take on debt would please agencies. However it does not help the individual person in the state as they are now more committed to paying debt, in the case of the teacher pensions it is pushed out until almost 2050.