Gov. Ned Lamont will unveil a $26.1 billion budget Wednesday for the next fiscal year that features few new initiatives and a plan to dramatically reduce Connecticut’s bonded debt using rapidly accumulating reserves from its transportation program, according to sources familiar with the plan. Connecticut budgets in biennial cycles, and the plan Lamont will present to the General Assembly on Wednesday represents adjustments to the second year of the biennium, the fiscal year that begins this July. The governor, a fiscal moderate, has been warning legislators for months to prepare for a lean plan, even though the next budget is expected to finish considerably in the black. Budget controls enacted in 2017 and renewed last February, including spending and borrowing caps and two other savings programs, leave little legal flexibility. But Lamont’s proposal also hinges on repurposing more than $50 million in unspent federal COVID-relief grants, which provide great fiscal flexibility because they can be spent outside of the cap system. But the shifting of these American Rescue Plan Act funds is expected to spark many questions from legislators, specifically: How much money have state agencies that received federal grants left unspent?
Lamont’s $26.1B budget plan takes a big bite out of bonded debt