Well That Clears THAT Up

by Categorized: Politix, Words and phrases Date:

Statement By OPM Secretary Ben Barnes –

OPM has informed the legislature’s Office of Fiscal Analysis of a potential discrepancy in its calculation of the expenditure cap growth rate for FY 2016. The growth rate that was included in the Governor’s budget proposal, 2.98%, was inadvertently calculated using personal income data beginning with the fourth calendar quarter of 2008 and ending with the third calendar quarter of 2014. The usual practice of OFA in calculating these growth rates is to use a range beginning with the third quarter personal income data in the relevant years. The statute is silent as to the exact data to use.

The discrepancy occurred when data was pulled from an outside vendor in January, 2015. A feature of this new vendor’s reporting system resulted in a one-quarter shift which was not recognized by OPM until after the Governor’s budget had been prepared and submitted.

Calculation of the expenditure cap using the 3rd quarter data would result in an expenditure cap growth rate of 2.58%, which would then result in a spending cap approximately $60 million lower than the cap presented in the Governor’s budget for FY 2016. The magnitude of this change is due in part to the fact that the quarters in question occurred in the midst of the the Great Recession, thereby leading to a lower rate of growth than in the period shifted one quarter later. Using the revised data, the Governor’s budget would be below the cap by $80 million in FY 2017.

On behalf of the agency, I personally apologize for this discrepancy, and commit to working with OFA and the legislature to identify the adjustments necessary to ensure compliance with the expenditure cap.

confusedBen Barnes

Secretary of the Office of Policy and Management

The Courant is using Facebook comments on stories. To comment on courant.com articles, sign into Facebook and enter your comment in the field below. Comments will appear in your Facebook News Feed unless you choose otherwise. To report spam or abuse, click the X next to the comment. For guidelines on commenting, click here.