The growth has effectively wiped out any projected shortfall after the next gubernatorial election.
The surge will make it much easier for officials to balance the budget without tax hikes.
Projected state revenues skyrocketed by $1.7 billion Friday, positioning officials to balance the next state budget without tax hikes.
The latest revenue projections show CT can expect $169 million more than the governor and legislators originally anticipated.
While the overall revenue drop could create the first deficit of Gov. Ned Lamont’s young administration, in reality, finances for this fiscal year remain more than $300 million in the black.
Critics call it ‘wishful budgeting’: The new plan is balanced in part on $180 million in tax revenue that none of the analysts have forecast.
State tax revenue projections surged again Tuesday, shrinking the projected shortfall in the upcoming two-year budget — and leaving Connecticut with nearly $2.1 billion in reserves to combat it.
Less than three weeks after legislators approved the new state budget, eroding revenues have opened deficits topping $175 million this fiscal year and nearing $150 million in 2018-19.
Updated at 3 p.m.
Analysts for Gov. Dannel P. Malloy’s adminstration and the legislature’s nonpartisan Office of Fiscal Analysis downgraded anticipated revenues for the next two fiscal years by $1.46 billion — nearly $600 million next fiscal year and $865 million in 2018-19 — largely because of eroding income tax receipts.
General Fund revenues for this fiscal year and each of the next two have grown — but by a tiny fraction of 1 percent in each case — according to a consensus report from Gov. Dannel P. Malloy’s budget agency and the legislature’s nonpartisan Office of Fiscal Analysis.
The projected deficit in the next two-year state budget has swelled by more than $500 million because of declining revenue projections, state fiscal analysts reported Thursday.
Despite rapidly eroding state income tax receipts, analysts for Gov. Dannel P. Malloy’s administration and the legislature are counting on payments from future legal settlements and other sources to mitigate much of the likely tax revenue loss next fiscal year.
Gov. Dannel P. Malloy and the legislature face more than $600 million in red ink this fiscal year and next combined — and another shortfall close to $1.4 billion after the next state election — if new revenue estimates released Tuesday are correct. That means the financial problems facing the Capitol over the next few years are roughly five times the size of Connecticut’s modest $406 million emergency reserve.
Despite a small bump upward in state tax receipts, new cracks in state finances surfaced Monday that could contribute to a budget deficit forecast by week’s end. A joint report by nonpartisan analysts and by Gov. Dannel P. Malloy’s administration projects total revenues will fall about $59 million below the level built into this year’s budget. (Photo: Benjamin Barnes, state budget director)