State ends fiscal year with deficit
Hartford – State Comptroller Kevin Lembo announced today that the state government entered a new budget year over the weekend and had a semi-official deficit of $192.3 million for the 2011-2012 year that ended June 30.
That deficit — about 1 percent of the total $20.1 billion budget for the year — ultimately will be eliminated by the Malloy administration’s strategy of transferring $222 million in General Fund reserves that had been set aside to pre-pay 2009 economic recovery notes.
Despite the record $1.5 billion in new taxes that took effect for the 2011-2012 budget year, there was a $250.7 million state revenue shortfall due to smaller-than-expected gross income tax receipts and higher-than-expected tax refunds.
Although tax receipts from capital gains and bonuses were up 5.9 percent, this increase wasn’t as big as state officials had hoped.
“If the estimated payment portion of the income tax had followed a more historically consistent post-recession pattern, the current deficit would have been significantly reduced or eliminated,” Lembo wrote in a letter to Gov. Dannel P. Malloy.
State government also overspent by an estimated $22.5 million, Lembo said.
Final and official numbers for the 2011-2012 budget year will come out Sept. 3.
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