Democratic candidate for governor Dan Malloy’s rather brave call for the state to adopt Generally Accepted Accounting Principles (GAAP) in budgeting will be a tough sell to the legislature despite the cum-bye-ah meeting he held Monday with Senate Democrats. GAAP has been raised in the legislature before and has always been postponed because using them would expose the state budget as the smoke-and-mirrors deal it usually is.
GAAP seems to be getting a lot of attention now because Malloy pitched it personally to Senate Dems this week. But readers of The Hanging Shad knew about this potential point of contention almost a month ago. The state budget often—and especially currently—relies heavily on one-shot (nonrecurring) revenue and borrowing. And while legislative leaders and Gov. Rell tout the budget they agreed to as a tough-decision-making job well done, GAAP would expose it for what it is—a temporary way to put off the hard decisions—and truthfully contains a gigantic deficit.
For instance, the budget deficit for this year using fuzzy math is less than $70 million. Using GAAP and exposing the one-shots and borrowing, the deficit is more like $2.5 billion.
Don’t expect that the tough and necessary decisions Malloy seems ready to boldly make to be rubber stamped by the legislature. Senate President Don Williams and some other members of his caucus Malloy met with this week backed the wrong horse in the primary (Ned Lamont). Fortunately, other leaders such as Majority Leader Marty Looney (D-New Haven) , Sens. Andrew McDonald (D-Stamford), Don DeFronzo (D-New Britain) and Andrea Stillman (D-Waterford) are more in tune with Democrats in the state and supported Malloy who won by 16 points.