Connecticut closed its books on fiscal 2010 with a $449.4 million surplus, but State Comptroller Nancy Wyman says the state is far from emerging from its fiscal thicket.
The surplus was mainly the result of federal stimulus funds and by nearly emptying the state’s savings account, Wyman said Wednesday.
“State government was fortunate to have these one-time funds available to help weather the economic downturn, but there was little other positive news in a very difficult year for our state and our taxpayers,” she said.
For the year that ended June 30, state expenditures exceeded revenues by $844 million in a total budget of $18.6 billion, her office said. That shortfall was turned into a surplus by measures including:
 — Taking nearly $1.3 billion from the state’s emergency Rainy Day Fund
— Using about $1 billion in federal stimulus funds
— Delaying a $100 million payment to the state employee pension fund
— Modest gains in tax revenue in the final few months of the fiscal year
The economic downturn and associated job losses resulted in overall General Fund tax revenues growing by just 1.7 percent for the year — well below the typical historical growth rate of about 5 percent and about $33 million short of budget expectations.Total General Fund spending was actually 0.2 percent lower than in fiscal 2009.
The state lost about 15,000 payroll jobs in the first six months of the fiscal year, but gained most of them back and ended the year with a net job loss of 1,800 positions, Wyman said. That upswing in jobs has led to recent gains in the two major revenue generators – the income and sales taxes.
Wyman noted, however, that the state is still feeling the effects of the loss about 100,000 jobs since the recession began in March 2008.
“While we all hope that this positive trend in jobs and revenue continues, it is still far too early to call this a solid recovery,” Wyman said.
The  2010 surplus will be counted as revenue in the $19.2 billion budget for 2011 that took effect July 1, she said. But mainly due to early cost overruns in the Department of Social Services, the 2011 budget is preliminarily forecast to end with a deficit of $63.4 million.
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