Higher than expected demand for social services, shortfalls in federal funding and poorly planned savings have led Connecticut to have a $64.3 million budget shortfall for the current fiscal year.
“I will be working with my budget officials to erase the shortfall through administrative actions,” Governor M. Jodi Rell said in a statement. “The fiscal year has barely begun and we have an opportunity – one we cannot afford to miss – to control this deficit before it grows unmanageable. I will be announcing the details of my budget-cutting plans soon.”
The $64.3-million deficit comes despite improvements in projected tax collections for income to $127.5 million and sales to $153.8 million.
The deficit materialized because the state’s share of newly enacted federal Medicaid and education funding is $193.4 million short; demand for social services went above planned levels; and planned savings never materialized from the $50 million in cost-cutting from the Legislature’s Enhancing Agency Outcomes panel.
