The needle has not moved on the state’s projected deficit. It remains at $259.1 million for the fiscal year that ends June 30.
State Comptroller Kevin Lembo, in his monthly fiscal report to Gov. Dannel P. Malloy, said a major driver of the deficit continues to be underperformance of Connecticut’s income tax. Withholding receipts were up 3.2 percent through April, he said, but non-wage income taxes have posted negative growth in the same timeframe.
Estimated payments are running 4.4 percent below last fiscal year and final payments are down 1.2 percent. “Stock market volatility that impacted Fiscal Year 2016 receipts was the strongest contributing factor in the decline,” Lembo said.
The total General Fund revenue shortfall for 2016 is projected to be $430 million – partially offset by spending that is $170.1 million below the spending plan.
In his letter to Malloy, Lembo also reported the status of the Budget Reserve Fund, which currently holds a balance of $406 million.
