As reported by the financial magazine Barron's, "S&P said the budget proposal 'highlights financial strain' at both the state and city level."
"Financial strain." With the state facing a more than $3 billion deficit in its next two-year budget, that's putting it mildly.
As Barron's notes, "S&P already has a negative outlook on Connecticut’s double-A-minus credit rating, which means it could lower its rating in the future." That would make it even more expensive for the state to borrow, something it's already doing far too much of anyway. And don't forget that Gov. Malloy has proposed bonding $250 million for renovations of the XL Center in Hartford.
S&P's analysts, not surprisingly, are concerned about the state's situation. "Rising state pension and other post-employment benefit payments are colliding with weak revenue growth because of poor economic performance in the state’s financial sector." Ouch.
They add: "Overall, the governor’s budget proposal makes hard choices to maintain structural budget balance. This in itself would be a positive development, if only Connecticut’s fixed costs didn’t remain a large share of expenditures and reserves remain low."
If only ...
If you want to read the entire Barron's story, you'll find it here.
For a more in-depth look, you can read this story by Keith Phaneuf at CTMirror.org.