The state is on track to end the current fiscal year with a $259.1 million deficit, according to projections released by the state comptroller Monday afternoon.
The updated consensus revenue estimates by the state Office of Policy and Management and the legislature’s Office of Fiscal Analysis reflect underperforming income tax receipts, as Comptroller Kevin similarly projected in recent months.
In a letter to Gov. Dannel P. Malloy, Lembo said total income tax receipts are expected to fall $559.4 million, or 5.7 percent short of the initial budget plan. That revenue shortfall, he said, combined with other revenue adjustments, result in projected General Fund revenue that is $430 million short of the budget plan.
“The major reason for the continued deterioration … is the underperformance of income tax receipts,” Lembo said. That’s in spite of 3 percent growth in payroll withholding. Lembo said the more volatile estimated and final payments portion of the income tax, which is dependent on capital gains and bonus payments, is down by 2 percent from last fiscal year.
Lembo reported that the revenue shortfall for fiscal year 2016 is partially offset by spending that is $170.1 million below the budget plan.
Read more
Malloy budget revisions would close $922M deficit
CT deficit creeps upward on corporation tax shortfall
Republicans propose five-year budget plan
Dems offer $920M in cuts, begin talks with Malloy
