This year’s budget is $72.2 million in the red. That’s according to the legislature’s nonpartisan budget office.
The projections, released late Monday evening by the Office of Fiscal Analysis, show the deficit has increased $65.1 million since a December special session to mitigate future budget deficits.
That’s on top of what budget analysts believe will be a $507 million shortfall in fiscal year 2017, which means when the General Assembly reconvenes in just two weeks they will need to work to resolve a nearly $580 million deficit.
Legislative analysts said part of the reason for the deficit is that Gov. Dannel P. Malloy’s administration hasn’t identified the $46.5 million in savings it promised to identify as part of the December special session. That, and a decline in personal income tax receipts and a $38.3 million increase in spending were cited as the reasons for this year’s deficit.
Just last week, Malloy’s budget office projected the state was running a $7.1 million deficit this fiscal year.
Senate Republican Leader Len Fasano, R-North Haven, said the governor’s Office of Policy and Management needs to “specify in writing exactly why their projection is $65 million less than the Office of Fiscal Analysis.”
He added that it’s unsettling to see such a huge discrepancy between “an objective non-partisan office and the governor’s partisan staff. It raises questions that need to be answered.”
House Minority Leader Themis Klarides, R-Derby, warned that there’s not even enough money in the Rainy Day Fund to cover the two-year deficit estimate of $580 million.
“The Rainy Day Fund won’t cover it; We are already in a fiscal drought,” she said. “This should be a warning signal as we begin the next legislative session as we craft laws and consider what we do.”
But the governor’s budget office and House Speaker Brendan Sharkey were not worried that the problem was insurmountable.
“The world is changing and we’re going to need to take the tough but necessary steps to change with it,” Gian-Carl Casa, undersecretary for legislative affairs, repeated Monday. “Households need to curb spending when necessary, and so does government.”
Sharkey said the hard work of balancing the budget will begin in earnest on Feb. 3.
“Whether the governor’s or legislature’s projections are more on target, when the session convenes next week, and the governor delivers his proposed adjustments, the challenge of ensuring the state budget is in balance begins in earnest,” Sharkey said. “An important part of that challenge is bringing more predictability and sustainability to the overall budget over time, and encouraging more regional approaches to local governing that increase efficiencies, lower property taxes, and reduce the need for state subsidies.”
The Senate Democratic caucus did not respond to Monday’s deficit figures.
State Comptroller Kevin Lembo will certify the budget numbers Feb. 1.