2018 Issues Conference
Budgeting in an Era of Fiscal Constraints
research guide
General background resources
Recent OLR and OFA products
Issue Brief: Connecticut’s Bonding Process (2018-R-0279)
Issue Brief: Connecticut’s Volatility Cap (2018-R-0296)
State and Local Budget Timing (2018-R-0314)
OFA’s FY 19 – FY 22 Fiscal Accountability Report (Nov. 15, 2018) and Presentation (Nov. 27, 2018)
State Action in the Absence of a Budget Before the Beginning of a New Fiscal Year (2017-R-0132)
History of State Action in the Absence of an Approved Budget (2017-R-0124)
OFA presentation on the state budget process
Legislative and Gubernatorial Appropriations, Revenue, and Bonding Responsibilities (2010-R-0131)
Constitution and statutes
Cod. Conn. Const. Art. III., Sec. 18 (link downloads a Word document). Limit on state expenditures. Maximum authorized increase; “emergency or extraordinary circumstances”; definitions to be defined by general assembly. Surplus.
Sec. 3-20(aa) – added by PA 17-2, June Special Session, s. 706 and amended by PA 18-49 s. 8 and PA 18-81 s. 21. The section of PA 17-2 required certain state bonds to include a pledge to bondholders that the state will comply with the Budget Reserve Fund (“Rainy Day Fund”) law, spending caps, and General Obligation and credit revenue bond caps, except under limited circumstances. The section of PA 18-49 involved the pass-through entity tax. The section of PA 18-81 shortened the length of the bond covenant requirement.
Sec. 4-71. Transmission to General Assembly of budget document in odd-numbered year and status report in even-numbered year. Report re three fiscal years immediately following biennium.
Sec. 4-71a. Estimates of recommended state grants-in-aid to towns under the budget document.
Sec. 4-72. Governor’s budget message.
Sec. 4-75. Publication of the budget document.
Sec. 4-76. Governor to explain budget document and reports to legislative committees.
CT Attorney General opinions
2017-08 (Oct. 3, 2017): “You have asked for an opinion on the following questions about the Governor’s authority to direct the expenditure of funds by executive order in the absence of legislatively enacted appropriations …”
2003-012 (July 16, 2003): “You have asked for a formal legal opinion concerning the General Assembly’s authority to enact a continuing resolution to appropriate funds for the operation of the state government in the absence of a state budget. As you note in your July 11, 2003 letter, the General Assembly passed two biennial budget bills earlier this year, both of which were vetoed by Governor Rowland. Given the lack of a budget for the new fiscal year beginning July 1, 2003, the General Assembly passed a two week continuing resolution or temporary appropriations measure on June 30, 2003 …”
1993-006 (April 14, 1993): “By letter dated January 11, 1993 you ask one question regarding the effect of Art. III, § 18(a), the balanced budget amendment, on deficiency legislation authorized by Conn.Gen.Stat. § 2-36. You also ask four questions on the relationship between the statutory and constitutional spending caps set forth in Public Act 91-3, § 30 and Article III, § 18 …”
1991-033 (Nov. 4, 1991): “This is in reply to your September 17, 1991 letter, renewing your earlier request for an opinion on August 9, 1991. In that letter, you asked ‘whether the Governor may act, through executive order, to appropriate and expend state monies by authorizing the continuation of government operations’ …”
1991-019 (June 7, 1991): “You have asked our opinion concerning the State’s authority to continue payment for state services if a State budget is not enacted by June 14, 1991 …”
Court opinion*
State v. Staub, 61 Conn 553 (1892) – this case dealt with the power and duties of the comptroller, especially in absence of a budget passed by the legislature.
Spending cap
Constitution and statutes
Cod. Conn. Const. Art. III., Sec. 18 (link downloads a Word document). Limit on state expenditures. Maximum authorized increase; “emergency or extraordinary circumstances”; definitions to be defined by general assembly. Surplus.
Sec. 2-33a. Limitation on expenditures authorized by General Assembly. The text at this link reflects the amendments to the statute made by PA 17-2, June Special Session, s. 709, which modified definitions used to calculate the state’s spending cap and required a base adjustment under certain circumstances.
CT Attorney General opinions
2015-05 (Nov. 17, 2015): “You have asked for a formal legal opinion concerning the legal effect of the constitutional and statutory spending caps set forth, respectively, in the Connecticut constitution, article third, § 18, and Conn. Gen. Stat. § 2-33a …”
1993-006 (April 14, 1993): “By letter dated January 11, 1993 you ask one question regarding the effect of Art. III, § 18(a), the balanced budget amendment, on deficiency legislation authorized by Conn.Gen.Stat. § 2-36. You also ask four questions on the relationship between the statutory and constitutional spending caps set forth in Public Act 91-3, § 30 and Article III, § 18 …”
Court opinion*
Nielsen et al. v. State of Connecticut et al., 236 Conn 1 (1996): “Taxpayers sought, inter alia, to compel the General Assembly to enact statutory definitions necessary to implement constitutional spending cap.”
Volatility cap
Recent OLR products
Issue Brief: Connecticut’s Volatility Cap (2018-R-0296)
Tax and Expenditure Limits and Revenue Volatility (2016-R-0040)
Statutes
Sec. 2-35 – The text at this link reflects the amendments to the statute made by PA 17-2, June Special Session, s. 707.
Sec. 2-36c(a) – The text at this link reflects the amendments to the statute made by PA 17-2, June Special Session, s. 708.
Sec. 4-30a – amended by PA 17-2, June Special Session, s. 704; subsection (a) was then amended by PA 18-49 s. 7 and PA 18-81 s. 20. The section of PA 17-2 diverted specified income tax revenue exceeding a $3.15 billion threshold to the BRF, increased the BRF’s maximum balance from 10% to 15% of net General Fund appropriations, and expanded its allowable uses. The section of PA 18-49 involved the pass-through entity tax. The section of PA 18-81 required the volatility cap threshold to be adjusted annually for personal income growth and allowed the legislature to amend the threshold under certain circumstances by a supermajority vote.
Budget Reserve (“Rainy Day”) Fund
Recent OLR product
Issue Brief: Connecticut’s Volatility Cap (2018-R-0296)
Constitution, statutes, and act
Cod. Conn. Const. Art. III., Sec. 18 (link downloads a Word document). Limit on state expenditures. Maximum authorized increase; “emergency or extraordinary circumstances”; definitions to be defined by general assembly. Surplus.
Sec. 4-30a – amended by PA 17-2, June Special Session, s. 704; subsection (a) was then amended by PA 18-49 s. 7 and PA 18-81 s. 20. The section of PA 17-2 diverted specified income tax revenue exceeding a $3.15 billion threshold to the BRF, increased the BRF’s maximum balance from 10% to 15% of net General Fund appropriations, and expanded its allowable uses. The section of PA 18-49 involved the pass-through entity tax. The section of PA 18-81 required the volatility cap threshold to be adjusted annually for personal income growth and allowed the legislature to amend the threshold under certain circumstances by a supermajority vote.
Sec. 3-20(aa) – added by PA 17-2, June Special Session, s. 706 and amended by PA 18-49 s. 8 and PA 18-81 s. 21. The section of PA 17-2 required certain state bonds to include a pledge to bondholders that the state will comply with the Budget Reserve Fund (“Rainy Day Fund”) law, spending caps, and General Obligation and credit revenue bond caps, except under limited circumstances. The section of PA 18-49 involved the pass-through entity tax. The section of PA 18-81 shortened the length of the bond covenant requirement.
PA 18-81 s. 22 (special in nature; will not be codified in the statutes) – required a portion of the income tax revenue diverted to the BRF in FY 18 to be used to pay certain liabilities.
Bond cap
Recent OLR products
Issue Brief: Connecticut’s Bonding Process (2018-R-0279)
Issue Brief: Connecticut’s Volatility Cap (2018-R-0296)
Statutes
Sec. 3-20. Short title: State General Obligation Bond Procedure Act. State Bond Commission. The text at the statute link reflects the amendments made by PA 17-2, June Special Session, but not the amendments made by the 2018 acts. Subsection (d) was amended by PA 17-2, June Special Session, s. 710, and then by PA 18-178 s. 42. Subsection (g)(1) was amended by PA 17-2, June Special Session, s. 711. Subsection (aa) was added by PA 17-2, June Special Session, s. 706 and amended by PA 18-49 s. 8 and PA 18-81 s. 21.
Sec. 3-21. Bond limitation. Debt certification. Bond issuance limitation. Allotment limitation. The text at the statute link reflects the amendments made by PA 17-2, June Special Session, but not the amendments made by PA 18-178. This statute was amended by PA 17-2, June Special Session, s. 712. Subsection (a) was amended by PA 17-2, June Special Session, s. 716, and then by PA 18-178 s. 43. Subsection (f) was amended by PA 18-178 s. 16.
CT Attorney General opinions
2018-04 (Nov. 21, 2018): State Treasurer Denise L. Nappier asked for a formal opinion concerning the impact of recent legislative amendments on the state’s bond cap and bond covenants.
State boards, commissions, and task forces
Commission on Economic Competitiveness (CGS 2-124)
Pension Sustainability Commission (created by PA 17-2, June Special Session, s. 180; see pages 229-231)
Commission on Fiscal Stability and Economic Growth (created by PA 17-2, June Special Session, s. 250; see pages 326-329)
Panel to Study and Make Recommendations Regarding the Proposals Made by the Commission on Fiscal Stability and Economic Growth Concerning the Rebalancing of State Taxes to Stimulate Economic Growth (created by PA 18-81 s. 56; see pages 58-60)
Panel to Conduct a Study of the Commission on Fiscal Stability and Economic Growth’s Proposal Regarding Teachers’ Retirement System Reform (created by PA 18-81 s. 58; see pages 61-62)
Online resources
State agencies
Office of Fiscal Analysis (OFA)
OFA Budget Books (an analysis of each budget as passed by the General Assembly)
Tax Expenditure Report (February 2018)
Office of Policy and Management (OPM)
Governor’s budget proposals and related documents (each budget proposal is typically accompanied by the Governor’s Economic Report and the Three Year Budget)
2018 agency budget adjustments and legislative proposals
Monthly financial statements (press releases)
Monthly General Fund and Transportation Fund financial statements (monthly letter to the governor)
NCSL and other organizations
National Conference of State Legislatures (NCSL)
National Association of State Budget Officers (NASBO)
The Fiscal Survey of States (Spring 2018)
States Target Surpluses to Rainy Day Funds (July 30, 2018)
State Expenditure Report: Examining Fiscal 2015-2017 State Spending (2017)
Gubernatorial Transitions and the State Budget (ca. 2017)
Budget Processes in the States (Spring 2015)
The Pew Charitable Trusts: States’ Fiscal Health Project
When Have States Saved Enough for a Rainy Day? (Oct. 4, 2018)
Where States Get Their Money, FY 2016 (July 24, 2018)
How States Raise Their Tax Dollars, FY 2017 (July 24, 2018)
Rainy Day Funds: Best Practices to Mitigate Revenue Volatility (June 7, 2017)
Fiscal 50: State Trends and Analysis (Nov. 19, 2018)
Legislative Library-compiled resources*
Budget adoption and budget revision acts 1971-2018
Budget documents timelines for 1991, 2003, 2009, and 2017
Periodicals and databases available to OLR and library staff*
The Legislative Library subscribes to State Tax Notes and to the databases of CCH Intelliconnect and Westlaw.
*These sources are accessible by contacting the Legislative Library.