HARTFORD — Connecticut's new two-year budget will face significant pressure from slow-growing revenues and looming payments for unfunded pension liabilities and other old debt, Gov. Dannel P. Malloy's budget director warned state lawmakers Wednesday.

During presentations from Ben Barnes and the General Assembly's Office of Fiscal Analysis about the state's fiscal situation, it was clear the 2017 legislative session will be marked by yet another difficult budget. The state's main spending account, the approximately $18 billion general fund, is expected to be as much as $1.3 billion in deficit.

"We have fixed costs related to our long-term liabilities that continue to dominate our state budget," Barnes told members of the legislature's two budget committees, adding how the state continues to see an "uneven" recovery from the economic recession of the late 2000s and early 2010s.

Over the new fiscal year that begins July 1, the state is on the hook to pay $278.3 million more into the teachers' retirement system, mostly because the Malloy administration is using more conservative actuarial assumptions. Also, it's anticipated Connecticut will spend an additional $120 million on retiree health benefits to help cover unfunded liabilities.

At the same time, nearly $485 million is supposed to be transferred out of the general fund to help reduce local property taxes and boost state transportation spending. That's in addition to a $178.7 million payment the state is scheduled to make that will finally pay off the money Connecticut borrowed in 2009 to balance that year's state budget.

Barnes noted how these hefty payments come at a time when Connecticut continues to experience subdued economic growth following the recession.

"Clearly, we're in a low-growth period," he said.

State lawmakers are scheduled to return to the Capitol in January for the new session. Malloy, a Democrat, is expected to unveil his proposed two-year budget in February.

----

This story corrects that revenues are supposed to be slow-growing, not slowing.