Governor Lamont Announces Connecticut Receives Credit Rating Upgrade From S&P

Press Releases

05/23/2022

Governor Lamont Announces Connecticut Receives Credit Rating Upgrade From S&P

(HARTFORD, CT) – Governor Ned Lamont announced today that he has been advised that ratings agency Standard & Poor’s (S&P) is raising the outlook for Connecticut general bonds to positive from stable.

Governor Lamont said, “Building on last year’s credit rating upgrade, this improved outlook further demonstrates that Connecticut is on solid financial footing. This progress is the direct result of historic payments to our unfunded liabilities, a record rainy day fund, and smart investments in our state’s future. Financial analysts continue to recognize that we have ended the proverbial practice of kicking the road for future generations, and we have actively taken steps to put our finances in order. Connecticut residents will benefit from this improved outlook in the form of lower borrowing costs and the signal it sends to businesses that our state is a place to grow and invest. While we must celebrate our successes, we must keep a cautious eye on the future. Now is not the time for excessive and unsustainable spending, rather it is yet another indicator that we must continue to make sensible and responsible investments that support our children, grow our economy and improve the lives of everyone who lives in Connecticut.

Office of Policy and Management Secretary Jeffrey Beckham said“In meetings with S&P following the enactment of the fiscal year 2023 budget revision, their team’s message was clear – Connecticut is on the right track with both a significant rainy day fund and additional payments on our unfunded liabilities Investors want us to continue to take both of these issues seriously, and if we do, we will be rewarded with lower borrowing costs.

In its notice to investors released today, S&P said“We believe that Connecticut has recently demonstrated its commitment to restoring fiscal reserves during periods of economic and income growth, which could protect its finances from recessionary headwinds. State officials believe that Connecticut generate general fund surpluses at the end of fiscal years 2022 and 2023 and bring the projected FAO balance at the end of the biennium to $3.31 billion, or 15% of the general fund appropriations for fiscal year 2023 (including mid-biennium budget adjustments) for the third consecutive fiscal year Surplus revenue deposits had reached or exceeded the statutory reserve cap of 15% in the FAO by the end of fiscal years 2020 and 2021. Along with the reserves of the state, this state has also recently maintained strong cash balances.

In 2021, Moody’s, Standard & Poor’s, Fitch and Kroll raised the ratings of Connecticut general bonds.

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