Christine Stuart photo
Ben Barnes (Christine Stuart photo)

(Updated 8:10 p.m.) April tax revenues did not come in as anticipated Friday, which means this year’s deficit will grow to about $256 million and the 2017 budget is $960 million in the red.

Office of Policy and Management Secretary Ben Barnes said most of the revenue shortfall the state is experiencing is related to declining income tax collections.

“The problems got a little harder,” Barnes admitted Friday in a visit to the Capitol press room.

The budget proposals from Gov. Dannel P. Malloy, Republican legislative leaders, and Democratic legislative leaders were all based on a $920 million to $922 million budget deficit, which means all three of the proposals are out of balance by about $40 million.

Senate Minority Leader Len Fasano, R-North Haven, warned the budget deficit could be as high as $1 billion because the revenue figures released Friday assume the Attorney General’s office will negotiate an additional $40 million in legal settlements.

“Once again the Democrats are leading Connecticut down a very dangerous path. This consensus revenue figure is counting on money the state simply doesn’t have. At best, this is a one-time revenue grab. At worst, this is an empty pot and a complete distraction from the real size of the problem we face,” Fasano said. “This maneuver is not only risky for our state’s financial health. It also puts the Attorney General’s Office at a huge disadvantage to solving any claims moving forward.”

House Minority Leader Themis Klarides, R-Derby, said the numbers were not unexpected, but “If anyone needed any additional evidence that significant structural changes are in order to address the ongoing, ‘drip, drip, drip’ of
deteriorating budget numbers, I don’t know what it is.”

Sen. Beth Bye, co-chairwoman of the Appropriations Committee, said Thursday that they are prepared for revenues to fall short and will be working to close whatever the final number ends up being.

As far as this year’s $256 million budget deficit, Barnes said he’s hopeful their attempts to constrain spending will yield additional results. Since there’s only two months left in the fiscal year, there are few if any places to cut and find savings.

The state has about $406 million in its Rainy Day Fund.

Barnes said once the books are closed on the year, any deficit will be deducted from the Rainy Day Fund.

The bad news about the revenues comes as legislative leaders and members of Malloy’s administration try to put together a budget for 2017 behind closed-doors.

Barnes declined to say where they will find an additional $40 million since negotiations are still ongoing.