Barnes Predicts $236.6M Surplus
Office of Policy and Management Secretary Ben Barnes predicted Thursday that the state will end the fiscal year with a $236.6 million surplus.
About $220.8 million of the surplus will be used to balance the 2014-15 year budget and the remaining funds will be transferred to the Rainy Day fund. The balance in the Rainy Day fund, which was depleted in 2011 when Gov. Dannel P. Malloy took office, will be $109.2 million as of June 30, 2013.
Estimated revenues are being revised upward to $57.9 million over last month’s projections. The largest change in the state’s revenue outlook is the “refunds in taxes” category which has improved about $25.8 million over last month. The corporation tax has been revised upward to $10.8 million and the inheritance and estate tax continue to outperform projections, allowing Barnes’ office to review them upward another $7.4 million.
Spending has dropped off by a total of $98.7 million since the beginning of the year. Most of the savings are attributed to the December deficit mitigation, the January hiring freeze, and other budget belt-tightening measures. The state had to spend $33.6 million more than it projected last month on an unanticipated increase in the funding requirements for the retired state employees healthcare account. The new accounting treatment of the fund which pays retiree health benefits was related to the transfer of the fund to the Core-CT system.
State Comptroller Kevin Lembo will certify the budget numbers on July 1. Last month, Lembo’s projection of the surplus was $212.3 million — a slightly more conservative number than the one reported by Barnes on Thursday.