In just another example of why Republicans are calling on Democrats to come to the negotiating table and help pass a balanced budget, the Comptroller announced this week that based on expected revenues and mandated expenditures, the state will fall short of what it needs to make its pension payment next month.
The state’s monthly pension payment of $560 million is the largest consistent expenditure throughout the year. Because November’s full pension payment won’t be invested now due to a lack of funds, that could negatively impact the overall investment of the pension system, which could lead to future increases in state contributions. Munger reiterated, however, that retirees will continue to receive their pension checks uninterrupted.
The Comptroller, like Republican Senators, have been warning that the unbalanced spending approach that Democrats have passed in the Legislature is a recipe for disaster, resulting in cash shortages, more unpaid bills, and extended payment delays. She says that the state is required to pay at last year’s levels, even though the state is expected to bring in $5 billion less this fiscal year.
Munger says the consequences of not passing a balanced budget are severe, and will grow more severe with each day.
This week, the backlog of unpaid bills reached $6.4 billion. Munger says the state is on track to have $8.5 billion in unpaid bills by the end of the calendar year.