By Peter Barhydt
State comptroller says stronger finances have stabilized Connecticut’s budget, but high costs remain a challenge for families and businesses.
Connecticut Comptroller Sean Scanlon told a Greenwich Chamber of Commerce audience that the state’s finances are far stronger than they were a decade ago but warned that officials must protect the fiscal guardrails that helped stabilize the budget while tackling rising costs that affect residents and businesses.
Scanlon spoke during a chamber speaker series event organized by the chamber’s Government and Community Affairs Committee.
He said Connecticut has recorded seven consecutive years of budget surpluses, built a $4 billion rainy day fund and paid down $10 billion in pension debt over the past six years.
“The crisis of 10 years ago was a fiscal crisis,” Scanlon said. “The crisis of today is affordability.”
Scanlon, a Democrat, said the state’s improved financial position stems largely from a bipartisan 2017 state budget that created a series of fiscal guardrails. The guardrails limit reliance on volatile revenue, require the state to save excess funds in reserves and direct surplus dollars toward paying down long‑term pension liabilities.
“As a result of that bipartisan budget and making those changes, we are now in a very, very different place as a state financially,” he said.
During a question‑and‑answer session, Scanlon said he opposes changing those guardrails before 2028, when they are scheduled to come up for reauthorization. He said there is growing pressure from both political parties to modify the rules.
“There are many people in my party … who would love nothing more than to break the guardrails and take the money that we’re putting aside and spend it doing other things,” he said. He added that some Republicans want changes as well, often to free up funds for tax cuts or energy relief.
“I think we should not mess with them until 2028,” Scanlon said, noting the guardrails are tied to state bond covenants and changes could undermine the fiscal discipline that helped restore stability.
However, Scanlon said one element of the system — the “volatility cap” — should eventually be revisited. The cap limits how much revenue from highly variable sources, such as capital gains taxes, can be used in the annual budget.
According to Scanlon, the current cap was based on a single, unrepresentative year. He said research conducted by his office with the Pew Charitable Trusts suggests using a three‑ or five‑year average would more accurately measure volatility.
He said that change could free up roughly $300 million to $400 million annually while still preserving the state’s fiscal discipline.
Scanlon said Connecticut now faces a different challenge than it did during the budget crises of the mid‑2010s: the cost of living and doing business.
He cited energy, housing, health care and child care as the biggest financial pressures on residents and employers.
Polling from the Connecticut Business and Industry Association reflects that shift, he said. In 2015, 79% of respondents in the group’s survey identified state government as the biggest challenge facing their businesses. By last year, he said, that figure had dropped to 7%, while concerns about major cost drivers rose.
“What we’re trying to do as a state right now is to try to address some of those things,” he said.
Scanlon also pointed to signs of economic growth. He said Connecticut ranked among the fastest‑growing state economies in the country in the second and third quarters of 2025.
Advanced manufacturing, particularly in defense‑related industries, has been a major contributor, he said. Companies such as Electric Boat, Pratt & Whitney and Sikorsky rely on networks of smaller suppliers across the state.
At the same time, Scanlon said Connecticut must address workforce and housing shortages that could limit future growth. He said the state currently has about 80,000 open jobs and emphasized the need to expand workforce development and technical education programs.
He also highlighted several state initiatives aimed at helping smaller employers, including MyCTSavings, a retirement program for workers whose employers do not offer retirement plans. Scanlon said the program now includes about 8,000 small businesses and has helped workers save more than $50 million.
Asked about the possibility of a recession, Scanlon said Connecticut’s current reserves place the state in a stronger position than in past downturns. Credit rating agencies estimate the state would need about $2 billion in reserves to weather a typical recession, he said, and Connecticut currently has about twice that amount.
However, he said federal policy changes could create new uncertainty for states, particularly around health coverage and food assistance programs.
First Selectman Fred Camillo, who served in the state legislature with Sean Scanlon, attended the breakfast told the Greenwich Sentinel, “It was great to see my former colleague and friend, Sean Scanlon, at the Greenwich Chamber of Commerce breakfast. I particularly appreciated his pointing to the bipartisan budget we put together in 2017 that included a volatility cap, a spending cap, and a bonding cap. He rightfully pointed to that historic budget, which was introduced by the Republican Party, but supported by the Democratic majority, as an example of how, when working together, fostering compromise and balance the state government can produce results that help all of us.”
Scanlon closed by encouraging attendees to contact him directly with concerns about state government or the business climate in Connecticut.
“If there’s something that you think we can do better for you, I hope you’ll feel free to reach out,” he said.
After the breakfast was over, Andrea Blume spoke the Sentinel and said, “We were pleased to welcome Connecticut Comptroller Sean Scanlan to Greenwich this morning for the Greenwich Chamber of Commerce Government and Community Affairs breakfast. The event brought together a great mix of business professionals, local business owners, and colleagues who have worked with Sean over the years in Hartford, which made for an engaging discussion.”
