Connecticut is projected to have a $242.4-million budget surplus for fiscal year 2019, state officials announced Wednesday.
In a letter to outgoing Gov. Dannel P. Malloy, State Comptroller Kevin P. Lembo revealed the estimated surplus and urged “sustained financial discipline” in fortifying Connecticut’s reserve funds to prepare for slow economic growth, uncertain federal funding and “volatility” in the financial markets.
Gov.-elect Ned Lamont, who will be sworn in Jan. 9, has promised he will not use Connecticut’s reserve funds to close a projected budget deficit of $1.7 billion in the fiscal year beginning July 1.
Under new statutory revenue caps, revenues exceeding a certain threshold must be transferred to the state’s reserve, or rainy day fund.
Lembo said recent job gains and wage growth are encouraging signs for Connecticut’s economy, but he cautioned there are other factors beyond the state’s control.
“Growing stock market turbulence and political uncertainty on the federal level may have an impact on consumer confidence as the government shutdown enters its second week with no end in sight,” Lembo said in a statement Wednesday. “Therefore, it is imperative that Connecticut continue to build a strong balance in the budget reserve fund to protect against any future downturn.”
As of Dec. 1, the state’s combined collections of estimated and final income tax payments were almost 14 percent higher vs. the year-ago period. But this, Lembo says, must be monitored over the coming months due to recent drops in the stock market.
