The consensus report from the Connecticut Legislature’s nonpartisan Office of Fiscal Analysis and Gov. Dannel Malloy’s budget staff has determined that the state’s General Fund revenues for the fiscal year will total more than $19.34 billion.
The figure includes nearly $1.3 billion in unanticipated income tax receipts derived primarily from capital gains and other investment earnings. Both numbers represent a moderate increase over the unanticipated revenues of 2016 and 2017, indicating that Connecticut’s economy is on the upswing – although it still trails much of the country.
Malloy called the report “unquestionably good news” and “a milestone we should all recognize and appreciate.”
The governor noted that in January 2011 the state faced a biennial deficit of more than $6 billion, a depleted Rainy Day Fund, and had taken on a $916 million deficit loan, which has since been fully repaid.
“In the intervening years, we’ve worked hard and made difficult decisions to set the state on more stable financial footing, including fully funding our pensions each and every year,” Malloy said.
The additional funds should help the Legislature in its efforts to produce a revised budget for the fiscal year, which it is expected to complete within nine days when its current session officially ends. It remains unclear if the legislature will use the newfound funds to eliminate the 2018 deficit of $381.8 million, or adjust the 2019 budget.
In 2009, in the midst of the Great Recession, lawmakers spent the entire Rainy Day fund of $1.4 billion to keep the government afloat.