Connecticut may have just a week's worth of cash
On Thursday August 19, 2010, 1:12 pm
NEW YORK (Reuters) - Connecticut this autumn probably would have just a little more cash than it needs to pay a week's expenses unless it issues $520 million of debt, according to the state treasurer.
Treasurer Denise Nappier, in a letter to the Connecticut Bond Commission, outlined her response to concerns that were raised about the state's finances by a legislator.
If the planned offering of general bond obligations were delayed until 2011, "This coming fall the state would likely have just over a week's worth of expenses in the bank -- a level lower than advisable," Napier wrote in an August 13 letter that is posted on her web site: state.ct.us
"Conceivably, the State may run out of funds for capital expenses that have already been authorized, allocated and incurred, such as school construction projects," she added.
So before the end of the year, Connecticut expects to offer the $520 million of general obligations and as much as $600 million of special tax obligations, which would raise money for transportation. Both issues likely would be offered via negotiation.
Separately, the Connecticut Bond Commission on Tuesday approved $260 million of debt to help pay for high-speed trains that will run through Connecticut and western Massachusetts, the governor's office said.
Also approved was about $581 million of general obligation bonds that will replace the same amount of Bond Anticipation Notes sold in the spring of 2009 to plump the state's cash cushion. The long-term debt likely will be issued in the spring of 2011, probably on a negotiated basis.
But the Connecticut Bond Commission rejected -- for now -- a $226 million proposal to buy 80 new MetroNorth rail cars after questions were raised about how to pay for this upgrade and whether commuter fares would have to be increased, officials said.
The other items on the bond commission's agenda were approved: ct.gov
(Reporting by Joan Gralla; Editing by Chizu Nomiyama) |
