The red ink keeps growing, according to the nonpartisan Office of Fiscal Analysis, which projected the state will end the year with a $161 million deficit. Gov. Dannel P. Malloy’s administration says its closer to $36 million.

With little more than four months to go in the fiscal year the Office of Fiscal Analysis and the Office of Policy and Management have different views about whether the state will end the year in the black or the red.

On Feb. 20 OPM expected to end the fiscal year June 30 with $39.1 million operating deficit under Generally Accepted Accounting Principles. Under current accounting methods its projecting ending the year with a balance of $35.9 million, up from last month’s $1.4 million.

Last month OFA pegged the deficit at about $145 million, but those numbers came out before Malloy announced he was using his executive authority to make about $34 million in rescissions above the $44 million already counted as lapses. OFA’s latest numbers count about $36 million in rescissions, but don’t include the $27 million settlement from the national mortgage foreclosure agreement or the $90 million from fiscal year 2011 that OPM says it plans on applying to fiscal year 2012.

Despite the doom and gloom, OPM Secretary Ben Barnes continues to maintain that the state will end the year in the black.

“We appreciate OFA’s ongoing attention to this issue. From our perspective, nothing’s changed. We’re still managing the state’s finances with an eye toward ensuring that we end the year in the black,” Barnes said.

OFA is reporting a decline in personal income tax associates with the Earned Income Tax Credit, which is anticipated to be $22 million higher than budgeted due to the popularity of the program and the amount of the average refund.

“As we noted last month, the biennial budget is heavily reliant on budgeted lapses to achieve balance,“ OFA said in its report. “So far, of the $777.9 million budgeted, we have been able to identify $666.8 million in lapses.”

Earlier this month, state Comptroller Kevin Lembo was more optimistic that the Malloy administration would meet its lapse numbers.

Lembo said OPM’s projection of a 5.9 percent growth is dependent on $900.7 million in lapses or forced savings, which should be “attainable” even though they are higher than in previous years.

“In light of state spending trends – and the budget control mechanisms available to OPM – this estimated savings is reasonable,” Lembo said. “I must emphasize that my analysis is based on the total state spending trend for the year, and not on achieving savings in any individual areas within the budget plan.”

Most of those lapse savings were expected to come from the deal Malloy struck with the state employee unions. OFA has been skeptical of the estimates used to calculate those savings since before the deal was struck with the unions.

The latest fiscal news from OFA also does not bode well for Malloy’s attempt to pay off the transition to GAAP accounting with $75 million in surplus funds.

“This does not include the $75 million payment the state needs to make in order for Governor Malloy to keep his promise of moving toward GAAP compliance,“ Sen. Minority Leader John McKinney said Friday. “That means Connecticut faces a $236 million budget hole with limited time and limited options left to fill it. Governor Malloy has a fiduciary responsibility to take this warning seriously and submit a plan to the legislature that will responsibly address this deficit.”

“A $31.5 million decline in revenue has led the legislature’s nonpartisan Office of Fiscal Analysis to determine that Connecticut’s budget deficit is getting worse, not better as the governor and administration officials would have us believe,“ McKinney added.

Republicans have increased their skepticism that Malloy will be able to end the year in the black, while the Malloy administration remains confidence that’s exactly what they plan on doing.

Lembo who projected that the state would end the fiscal year with a $73.6 million deficit under GAAP will release his latest projections on March 1.