A rainy day or rainy day fund is a reserved amount of money to be used in times when regular income is disrupted or decreased in order for typical operations to continue. In the United States, the term is usually used to apply to the funds maintained by most
U.S. states
In the United States, a state is a constituent political entity, of which there are 50. Bound together in a political union, each state holds governmental jurisdiction over a separate and defined geographic territory where it shares its sove ...
to help deal with budget shortfalls in years where revenues do not match expenditures. This is critical to the operations of most states, which do not permit their governments to take on debt, meaning that services would have to be cut in the absence of reserve funds.
New York State Comptroller
The New York State Comptroller is an elected constitutional officer of the U.S. state of New York and head of the New York state government's Department of Audit and Control. The New York State Comptroller is the highest-paid state auditor or ...
Thomas DiNapoli
Thomas Peter DiNapoli II (born February 10, 1954) is an American politician serving as the 54th and current New York State Comptroller since 2007. A member of the Democratic Party, he was previously the New York State Assemblyman for the 16th dist ...
recommended in March 2010 that the state require that one half of surpluses be deposited into the rainy day fund.
["DiNapoli wants to alter budget process"]
''Business First of Buffalo'' and ''The Albany Business Review'', March 9, 2010. The
rainy day fund has been the focus of tussles between the
Governor of Massachusetts
The governor of the Commonwealth of Massachusetts is the chief executive officer of the government of Massachusetts. The governor is the head of the state cabinet and the commander-in-chief of the commonwealth's military forces.
Massachusetts ...
and the
Massachusetts General Court
The Massachusetts General Court (formally styled the General Court of Massachusetts) is the state legislature of the Commonwealth of Massachusetts. The name "General Court" is a hold-over from the earliest days of the Massachusetts Bay Colony, ...
. Some research suggests developing a national rainy day fund for states might improve state credit ratings and reduce capital financing costs for states.
See also
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Contingency fund
A contingencies fund or contingency fund is a fund for emergencies or unexpected outflows, mainly economic crises.
European Union
The European Union created a vast contingency fund in 2010 to counteract the Great Recession.
India
The Constituti ...
*
Emergency fund An emergency fund, also known as contingency fund, is a personal budget set aside as a financial safety net for future mishaps or unexpected expenses. A critical part of financial planning, it is supposed to ensure one's personal finances are prepa ...
References
External links
Massachusetts 'Rainy Day' Stabilization Fund
Government budgets
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