State Comptroller Nancy Wyman certified that the state will end the fiscal year with a $242.9 million surplus.
That is $76 million higher than she reported last month and is largely the result of increased sales tax receipts.
After many months of double-digit declines, the sales tax began rebounding in March and has been producing average monthly gains of about 2 percent, but is still expected to bring in about 5 percent less revenue than last year.
“The sales tax picture is a good indicator of how deep of a hole the recession created in revenues,” Wyman said. “Even with the recent improvements, we still have a long way to go before we can call this a recovery.”
The increase in sales tax receipts is directly tied to Connecticut’s job gains, Wyman said. Connecticut lost 103,000 jobs when the recession started back in 2008, but the state has regained about 15,000 since January.
Wyman also cautioned that a $500 million deficit projected for most of this fiscal year was eliminated not by revenue gains, but by federal stimulus dollars, the Rainy Day fund, deferral of state pension payments, and other one-time budget gimmicks.
“In the absence of these non-recurring revenues and expenditure reductions, the Fiscal Year 2010 General Fund operating budget deficit would exceed $2 billion dollars,” Wyman wrote in her monthly letter to Gov. M. Jodi Rell.
Rell participated in a press conference Wednesday in which she said if Congress fails to pass the Medicaid extension it will create a $266 million hold in the 2011 state budget. Currently the 2011 budget year that starts today is balanced on paper.