State officials warn on depletion of CBR fund

State budget deficits continue to drain reserves, and state officials now warn that some balance must be maintained for cash management purposes and emergencies. The projected deficit for Fiscal Year 2018, the current budget year that ends next June 30, is estimated at $2.6 billion. When that is paid the remaining funds in the Constitutional Budget Reserve, the state’s main cash account, are estimated at $2.1 billion. This is insufficient to pay a deficit for FY 2019 of a size similar to that of FY 2018, and to fully fund the budget other funds would be needed, such as from a new tax or money taken from the Permanent Fund’s earnings reserve. State budget officials also advise that a healthy balance, in the range of $2 billion, should be left in the CBR account to handle routine cash management for the state, and for emergencies.