There could be more than $500 million available to Gov. Dannel P. Malloy and the legislature this spring as they prepare the final state budget before the 2014 elections.
According to the regular monthly report filed by Malloy’s budget staff with Comptroller Kevin P. Lembo’s office, this fiscal year’s budget is on pace to run $273 million in the black.
The new surplus forecast is up $137 million from one month ago, due largely to higher-than-expected returns from this fall’s tax amnesty program. It represents about 1.5 percent of this fiscal year’s general fund, which covers the bulk of operating expenses in the $18.6 billion state budget for 2013-14.
Coupled with the $271 million in the state’s emergency budget reserve – commonly known as the Rainy Day Fund – this $273 million surplus projection means there could be $544 million available for Malloy and lawmakers to work with this spring as they revisit the preliminary $19 billion budget adopted in June for 2014-15.
Though the state had good results with its tax amnesty program, Malloy’s budget chief, Office of Policy and Management Secretary Benjamin Barnes, warned Lembo that Connecticut must keep a close watch on federal lawmakers.
Barnes said that Congress reached a bipartisan compromise with President Obama on appropriations bills that likely eliminate a federal government shutdown in January. But Washington still has a major fiscal duty to confront: Raising the debt ceiling.
“We remain concerned, however, about the potential economic impact of political confrontation regarding the debt ceiling, which must be addressed in February or March,” he said.