Office of Policy and Management Secretary Ben Barnes has projected a state budget deficit of more than $178 million, two weeks after the state passed a bipartisan compromise budget.
“The governor”™s caution regarding our ability to get through fiscal year ’18 in balance under the bipartisan budget passed by the General Assembly was well-warranted,” Barnes said in a statement. “This consensus revenue projection will likely place us more than $178 million in deficit before we have even had an opportunity to effectuate the large lapses and spending cuts built into the budget.
Office of Policy and Management “will finalize our projection in our letter to the comptroller next week, and the administration will continue to do its part to monitor revenues and expenditures closely,” Barnes said.
Shortfalls in income and sales tax receipts are contributing to the deficit, which are on pace to reach $178.4 million this fiscal year and $147.1 million the following fiscal year. That $325.5 million total is well beyond the $213 million the state now has in its reserve funds. Comptroller Kevin P. Lembo recommends a reserve of more than 12 times that level.
In a joint statement, Senate President Pro Tempore Martin M. Looney (D-New Haven) and Senate Republican President Pro Tempore Len Fasano (R-North Haven) said: “These numbers are disappointing but not unexpected. It”™s clear that now is the time to give cooperation and collaboration a chance to build on the bipartisan budget passed into law last month, which makes important long term systemic reforms.
“Many of these structural changes may not result in an instantaneous change,” they said, “but rather will begin the process to improve financial management and eliminate this type of volatility and unpredictability in the future. We will continue to examine this report, monitor these numbers closely and remain committed to working together to make adjustments to the budget if needed in the coming months.”
