Gov. Dannel P. Malloy’s administration reported a modest $22 million surplus projection Monday for the current fiscal year — despite nonpartisan analysts’ warnings that eroding income tax receipts have created a $65 million deficit.
The Office of Policy and Management’s surplus projection represents a small fraction of the General Fund, roughly one-eighth of 1 percent.
But it does not reflect the income tax erosion that the legislature’s nonpartisan Office of Fiscal Analysis reported three weeks ago.
Malloy’s budget director, OPM Secretary Ben Barnes, acknowledged in his report that tax collections after the April 15 income tax filing deadline will be key, as they are many years, in determining whether state government will finish the fiscal year in surplus or deficit on June 30.
“Revenues continue to reflect the consensus revenue forecast reached by my office and the Office of Fiscal Analysis on January 17th,” Barnes wrote in his monthly budget forecast.
“As we note each month, the foregoing information represents the best forecast that can be made at this time, and future estimates will differ as a result of changes in the economy, expenditure patterns, and/or other factors as the year progresses,” Barnes added.
While most of the challenges facing the current budget are on the revenue side, projected spending is running marginally over budget by about $11.5 million.
The Office of Fiscal Analysis is expected to issue another budget forecast next week, and Comptroller Kevin P. Lembo’s next projection is due on April 1.