McKinney: “This Legislature’s Budget Earned its Failing Grades”

June 4, 2010

Minority Leader warns future legislatures and administrations not to make the same mistakes

Hartford, CT – Senate Minority Leader John McKinney responded today to news that Fitch has lowered Connecticut’s bond rating by reiterating his opposition to the $19 billion state budget adjusted in May and warning future legislatures and administrations to “heed the lessons learned over the past two years and not make the same mistakes again.”

New York-based Fitch Ratings has lowered Connecticut’s bond rating one level to AA, weakening the state’s borrowing ability, just as it prepares to borrow $956 million to close its FY11 budget gap. Fitch is the third major bond rating agency to downgrade Connecticut following Standard & Poor’s on Wednesday and Moody’s Investor Services on May 27.

“I hope the people of Connecticut, the administration and the legislature see these lowered bond ratings for what they are: failing grades for an irresponsible budget solution that borrows too much, taxes too much, and does too little to reduce government spending,” said Senator McKinney. “At the very least, I hope the Democrat leaders who proposed this budget and all those who supported it are learning their lesson. And I hope those aspiring to be in the next legislature are prepared to right the wrongs of this General Assembly by rolling up their sleeves and making the difficult, but necessary decisions to protect taxpayers and future generations by finally cutting the size and cost of state government to a level Connecticut residents can afford.”

In reducing Connecticut’s rating, Fitch analysts cited an overreliance on “borrowing to address its ongoing fiscal challenges in the context of already high liabilities and large projected structural gaps.” The report stated: “The downgrade reflects the state’s reduced financial flexibility, illustrated by its reliance on sizable debt issuances during the current biennium to close operating gaps in the context of already high liabilities.”

“There’s still time to do something about this,” said Senator McKinney, “We should be in special session prior to June 30th to make structural cuts to the FY11 budget that will enable us to reduce the amount we need to borrow.”